Tesla to join the S&P 500 in December | DW

Darnell Taylor
November 18, 2020

At US$400 billion or more, Tesla's market capitalisation should amount to more than 1% of the total value of the companies listed on the S&P 500, potentially making it the biggest ever addition to the index.

The company that Tesla is replacing on the index will reportedly be announced at a later date.

Tesla's addition to the index will be effective from December 21.

S&P Dow Jones Indices said it will add the electric automaker to the S&P 500 at the start of trading on December 21.

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The Palo Alto, California-based company has a market cap of around $387 billion, which would make it one of the most valuable companies in the S&P 500. Because of the potential for additions and deletions to the index to shake up the markets, the selection process is carefully guarded, which could help to explain the S&P committee's reluctance to include Tesla during its initial consideration of the company.

More recent developments - the unveiling of Tesla's long term battery plan, and the roll-out of its "fully functional" Full Self Driving beta to select drivers - have not yet gained traction n in market value terms, as investors cautiously wait to see both new technologies come to full fruition.

In 1999, Yahoo surged 64% in five trading days between the announcement that it would be added to the index and its inclusion. On Tuesday, the shares ended up 8.2 per cent, pushing his fortune US$7.6 billion higher to US$109.7 billion, according to the Bloomberg Billionaires Index.

The Tesla Cybertruck is unveiled at Tesla's design studio Thursday, Nov. 21, 2019, in Hawthorne, Calif. CEO Elon Musk is taking on the workhorse heavy pickup truck market with his latest electric vehicle.

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