Tesla to join S&P 500, spark epic index fund trade ... SWINDLE

Tom Paine 1949

Diamond Member
Joined
Mar 15, 2020
Messages
2,064
Reaction score
1,681
Points
1,908
This is a giant rip-off of conservative S&P Index investors, who are now being forced to invest in the biggest bubble stock of the moment. We will lose and the professional short sellers will make billions as this stock collapses to a small percentage of its present value. Wait and see ...

(Reuters) - Tesla Inc is set to join the S&P 500 in December, a major win for Chief Executive Elon Musk that boosted the electric car maker’s shares 14% on Monday in anticipation of a $51 billion trade by index funds adjusting their holdings.

“(Tesla) will be one of the largest weight additions to the S&P 500 in the last decade, and consequently will generate one of the largest funding trades in S&P 500 history,” S&P Dow Jones Indices said.
With a stock market value over $400 billion, Tesla will be among the most valuable companies ever added to the widely followed stock market index, larger than 95% of the S&P 500’s existing components.

Its inclusion means investment funds indexed to the S&P 500 will have to sell about $51 billion worth of shares of companies already in the S&P 500 and use that money to buy shares of Tesla, so that their portfolios correctly reflect the index, according to S&P Dow Jones Indices. Tesla will account for about 1% of the index....

Up about 450% in 2020, the California car maker has become the most valuable auto company in the world, by far, despite production that is a fraction of rivals such as Toyota Motor, Volkswagen VOWG_p.DE and General Motors.

Many investors believe Tesla’s stock is in a bubble, and some have warned against adding it to the S&P 500 at current levels.

“(Monday’s) price jump means the retirees and other individual investors who put their money into index funds will see some of their money go into Tesla stock at a price even higher than its controversially high pre-S&P price. It’s a downside of index investing for conservative investors”...

Tesla short sellers point to looming competition from longer-established rivals. They are also skeptical of Tesla’s corporate governance under Musk, who in 2018 agreed to pay $20 million and step down as chairman to settle fraud charges.

 
Last edited:
OP
Tom Paine 1949

Tom Paine 1949

Diamond Member
Joined
Mar 15, 2020
Messages
2,064
Reaction score
1,681
Points
1,908
It ought to be at least mentioned that Tesla’s founder and long-term CEO Elon Musk was a prominent supporter of Donald Trump. Musk was also widely quoted for his open support encouraging coups, especially the 2019 coup in Bolivia, where mining and processing Lithium deposits, crucial for Electric Car batteries, was in play.

Fortunately, the coup was overwhelmingly rejected and democracy re-established by a recent majority popular vote. The social-democratic MAS government is back in power. The mineral wealth in Bolivia will now hopefully be channeled not primarily into serving foreign corporations and capitalists, but also into desperately needed social development and into improving this poor nation’s overall economy. See: Stunning Victory for Social DEMOCRACY in Bolivia!
 
Last edited:

Tommy Tainant

Gold Member
Joined
Jan 20, 2016
Messages
24,399
Reaction score
4,787
Points
290
Location
Y Cae Ras
It ought to be at least mentioned that Tesla’s founder and long-term CEO Elon Musk was a prominent supporter of Donald Trump. Musk was also widely quoted for his open support encouraging coups, especially the 2019 coup in Bolivia, where mining and processing Lithium deposits, crucial for Electric Car batteries, was in play.

Fortunately, the coup was overwhelmingly rejected and democracy re-established by a recent majority popular vote. The social-democratic MAS government is back in power. The mineral wealth in Bolivia will now hopefully be channeled not primarily into serving foreign corporations and capitalists, but also into desperately needed social development and into improving this poor nation’s overall economy. See: Stunning Victory for Social DEMOCRACY in Bolivia!
I have always avoided tesla as their cheif exec seems to be unstable.
 

Leo123

Platinum Member
Joined
Aug 26, 2017
Messages
10,548
Reaction score
4,063
Points
360
A friend of mine invested in Tesla early on. Since then his investment has multiplied to the point where he now has hundreds of thousands of dollars. He took a fraction of it and bought a Tesla car.
 

justinacolmena

Gold Member
Joined
Oct 9, 2017
Messages
3,655
Reaction score
949
Points
140
Location
alaska, usa
This is a giant rip-off of conservative S&P Index investors, who are now being forced to invest in the biggest bubble stock of the moment. We will lose and the professional short sellers will make billions as this stock collapses to a small percentage of its present value. Wait and see ...
It's a clear indication of hidden recklessness in the management vs economic conditions of the other companies that comprise the S&P 500. I prefer small to mid cap stocks such the Russell 2000, or I would if I had any money to invest. The risk of investing in smaller companies is easily mitigated by diversification.

My personal situation, as a victim of ongoing and repeated identity theft, extortion, robbery, larceny, and "the usual" rough-up and shake-down by communist police, prohibits any significant "investment" as such on my part.
 

Tommy Tainant

Gold Member
Joined
Jan 20, 2016
Messages
24,399
Reaction score
4,787
Points
290
Location
Y Cae Ras
A friend of mine invested in Tesla early on. Since then his investment has multiplied to the point where he now has hundreds of thousands of dollars. He took a fraction of it and bought a Tesla car.
Thats a dream investment isnt it ?
I invested in NIO as a tesla alternative. They are a Chinese company but listed on the US market.They are doing well but not well enough for me to buy a NIO, yet.
 

Most reactions - Past 7 days

Forum List

Top