“We expect TSLA stocks to trade significantly more on the news,” said Garrett Nelson, analyst at research firm CFRA. Tesla jumped more than 12% early in Tuesday, adding more than $ 30 billion to its market cap at the opening bell.
Based on Tesla’s size – at its current valuation, it will be among the 10 largest companies in the S&P – Credit Suisse estimates that passive funds will need to purchase around 95 million shares, with active managers bringing the total to around 125 million shares. This means significant sales in other positions, to the tune of around $ 51 billion, according to S&P Dow Jones Indices, which said the addition of Tesla “will generate one of the largest financing deals in the world. history of the S&P 500 ”.
But some believe this year’s purchase – stocks more than quadrupled in 2020 – was in anticipation of Tesla’s addition to the index, meaning any rise in stocks could be short-lived.