When Tesla Hits the S&P 500, It’ll Spark the Wildest Passive Trade Ever
Elon Musk’s company would be the largest ever added to the index, and its inclusion would spark an “all-hands” trading moment.
Tesla CEO Elon Musk
Photographer: Frederic J. Brown/AFP/Getty ImagesBeating the S&P 500 is notoriously difficult for fund managers. But simply replicating it as closely as possible isn’t always a picnic, either—and Tesla Inc. has found a way to make it a little harder.
The market value of the electric car company currently stands at about $277 billion. That would make it one of the biggest companies in the S&P 500, except that it isn’t a part of the index yet. The keepers of that list, S&P Dow Jones Indices, have a rule that new companies must have been profitable in their most recent quarter and over the past year before being added. With its latest earnings, Tesla just crossed that line.