Shall TSLA be added to S&P500? (out of main)

[hershey101]

Usually, stock specific market moving events like this are discounted immediately. For example, if a pharma gets a bad decision on a drug, the price drop is all but done in two minutes, assuming the company has fundamentals that allow it to continue operations.

Big Players had three hours to clean out positions if all they were around for was the S and P. TSLA already down from a brief high of around 540. We got a thirty point drop after this lack of inclusion. There was support at 390.

Fundamentals of company improve on almost daily basis. Battery day coming. P and D results for blowout quarter to follow.

And the truth is no one really knows what the S and P will do. They could issue a PR any day.

SP moves are always a hard call and this one seems to be harder than usual. Obviously for long term holders this is immaterial. For traders....could well be that downside is not significant from here. I would fear continued weakness in macros more than the S and P. QQQs continuing correction will definitely bring down TSLA as well.

Did TSLA get where it was because of S and P? It was in the mid 200s and sliding when the split announcement came. Seemed that people had given up on S and P at that point.

Anyway, all the best and Good Luck.

Tesla has always been a momentum stock. Splits add no value so the run-up cannot from $1350 -> $2500 cannot be attributed to the split in any fundamental sense.

At the end of the day, S&P and the split (both of which TMC knew for months) added to the story/momentum and drove us from <$1k to $2500. When momentum reverses, it wouldn't surprise me to see $TSLA being cut in half (if not more). Is not being included in S&P sufficient to hault momentum? IDK, but I'd say, that combined with any macro weakness should let the air out of this stock.

I will wait until that happens to rebuild my position in $TSLA. It wouldn't surprise me if $TSLA hit $250, $200, or even $150.

 

[TheTalkingMule]

I see what you did there.

I could see it hitting $114 easily. Or even $26!

The split clearly squoze the shorts as no one would sell to them because we're waiting in an additional inclusion squeeze. Nothing has changed.

We'll have the normal volatility, but at the end of the day inclusion will be happening, those shares will need to be bought, and there will be no one to sell. They're just making it worse by delaying.

 

[Buckminster]

I think it's over for tsla and s&p for near term

An S&P Global (SPGI) spokesperson declined to comment of the reasons Tesla wasn’t included, saying, “the committee takes into account several factors such as sector balance and size representation.”

 

[BlindPass]

Tesla has always been a momentum stock. Splits add no value so the run-up cannot from $1350 -> $2500 cannot be attributed to the split in any fundamental sense.

At the end of the day, S&P and the split (both of which TMC knew for months) added to the story/momentum and drove us from <$1k to $2500. When momentum reverses, it wouldn't surprise me to see $TSLA being cut in half (if not more). Is not being included in S&P sufficient to hault momentum? IDK, but I'd say, that combined with any macro weakness should let the air out of this stock.

I will wait until that happens to rebuild my position in $TSLA. It wouldn't surprise me if $TSLA hit $250, $200, or even $150.

I mostly agree.
Tesla will eventually be in the S&P and it will eventually fulfill the disruption priced into $2500. The calls for such high targets still make a lot of sense to me. But the market turned this into a momentum, trader stock once COVID brought to the mainstream the future of disruption.

Personally I hope it does go to $150. I’ll buy. I also hope it was all momentum, and that the market is still in the dark about the fundamentals that make Tesla’s future so promising

 

[hershey101]

I mostly agree.
Tesla will eventually be in the S&P and it will eventually fulfill the disruption priced into $2500. The calls for such high targets still make a lot of sense to me. But the market turned this into a momentum, trader stock once COVID brought to the mainstream the future of disruption.

Personally I hope it does go to $150. I’ll buy. I also hope it was all momentum, and that the market is still in the dark about the fundamentals that make Tesla’s future so promising

$150 seems very unlikely (although I'd like to add more)... However, $250-$275 is very much in the realm of possibility. I think $200 is going to be very strong support on the stock.

Let's see... I'm accumulating $ARKK for my indirect exposure to $TSLA since $TSLA is now out of my valuation models.

 

[Buckminster]

Congrats all!
Haven't seen this confirmed yet:

Actual S&P500 funds can normally only buy in the ~3 days prior to and after the inclusion date. So with inclusion being 12/21 they could start buying 12/16 and have to finish by EOD 12/24. If they decide to do two tranches there would be an additional buying period of 12/9-12/17. So they would overlap making the buying period 12/9-12/24, though half would have to be bought in the first part of the period and half in the later portion of the period. (Or they could buy it all on 12/16-12/17 and be done.)

At least that is my understanding of how it all works.