$Tesla (TSLA.US)$Ahead of its inclusion in the S&P 500 index, Tesla's stock trading volume is projected to reach an unprecedented $80 billion by Friday's close.
Tesla will become the largest company by market value ever added to the S&P 500 on Monday, with a weighting of over 1% in the index. Since the announcement of its inclusion in the S&P 500 in mid-November, Tesla’s share price has risen by approximately 60%.
According to S&P Dow Jones Indices, Tesla's inclusion in the S&P 500 will force index-tracking funds to purchase more than $80 billion worth of Tesla shares before Friday's close so that their portfolios accurately reflect the performance of the S&P 500. These funds will also need to sell an equivalent amount of other S&P 500 constituent stocks.
"Index managers will need to sell a significant amount of other S&P 500 constituents in order to buy Tesla shares, which could have a major impact across the entire index," wrote Ivan Cajic, Head of Index Research at Virtu ITG Canada, in a report this week.