Tesla’s S&P 500 Entry Puts $70 Billion of Passive Trades in Play
- Money managers to adjust portfolios for $550 billion company
- Index provider had considered adding Tesla in two tranches
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Tesla Inc. climbed on Tuesday as investors braced for the company’s addition to the S&P 500 in one shot on Dec. 21, a move that’s expected to spur as much as $70 billion worth of passive-fund flows.
At $550 billion, Tesla’s market capitalization is more than any other company had at its debut in the benchmark gauge. Given that size, the index provider had considered adding Tesla in two tranches to limit the potential for disruption as money managers adjust their portfolios to make room for stock.