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Tesla Equity Sale Comes at a Good Time for Index-Fund Trackers

  • Electric-vehicle maker to issue more shares before S&P 500 add
  • Index inclusion expected to spark billions in Tesla buying
Tesla more than doubled its planned spending on plants and equipment this year.

Tesla more than doubled its planned spending on plants and equipment this year.

Photographer: Qilai Shen/Bloomberg 

With Tesla Inc. about to be added to the S&P 500, people have wondered where index-tracking mutual funds will find the $80 billion of stock they’ll need to own in Elon Musk’s car-maker. Now they know: at least some of it will come from Elon Musk’s car-maker.

Taking advantage of this year’s 677% surge, Tesla said in a filing Tuesday it plans to sell as much as $5 billion in common stock. The news came two weeks before the $616 billion company’s shares are scheduled to enter the S&P 500 Index, the largest addition ever.