Wall Street Braces for the Impact of Tesla's Big Day on Monday
After months of anticipation, Tesla (NASDAQ: TSLA) will join the big leagues on Monday and begin trading as part the S&P 500 index. Funds that track the stock market index will need to buy roughly 129.9 million shares of Tesla in order to match the composition of the index, according to estimates released by Standard & Poor's. At the current stock price of roughly $655, that could result in purchases of more than $85 billion in Tesla stock, according to CNBC.
As massive as it is, that figure could end up being conservative. There are many funds and individual investors that unofficially track the S&P 500, without paying the index the required fee. The amount of these "closet indexers" is difficult to nail down, but could increase the number of shares purchased by as much as 50% to 100%.
Image source: Tesla.
Source Fool.com
