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ETF question

Posted on 6/4/20 at 5:39 pm
Posted by BamaAlum02
Huntsville, AL
Member since Nov 2005
1009 posts
Posted on 6/4/20 at 5:39 pm
I read an article that $TSLA was positioning itself to be included in the S&P 500. I believe they just needed to show a profit for Q2 2020 to qualify.

My question is, once a company like Tesla enters this group how do the ETF's that track the S&P handle their stock? Do they immediately begin buying? I always assumed there was some algorithm that bought and sold to keep the index weighted but wasn't sure. Seems like it could really drive up the price if that was the case.
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