Hey, everybody Rob Maower here and today we are attempting to answer the question of when will test will be added to the S&P 500 index.

As we know with Tesla's second quarter results, the company posted a gap profit for the

quarter as well as for the trailing 12 months for the first time.

So that was the last guideline for inclusion in the S&P. for the decision is made by the S&P 500 Index selection committee. They have the discretion to change

their guidelines at any time or to include or not include any company even if it doesn't necessarily

fit with those guidelines. The guidelines are there for a reason though of course so most of the time the decisions do conform to them.

There is no guarantee though that Tesla would be added. For example, the S&P 500 committee might decide that they don't like the amount of regulatory credits that are helping Tesla be profitable at this point in time.

So perhaps the committee would be more comfortable delaying inclusion until Tesla posts a 12-month period of profit without those regulatory credit sales.

Unfortunately no way for us to know that ahead of time, but the reason that people care so much

about the possible inclusion is because when and if Tesla is included in the index, that should mean that the roughly 4.6 trillion

dollars in assets under management that track the performance of the index would likely need

to buy about 26 million shares of Tesla stock, which is significant that's about 17% of the float share count or the

share count that is not locked up by insiders that are unlikely to sell.

So with that background out of the way, let's assume the S&P 500 committee does decide to add Tesla based on their second quarter results and let's look at the history of changes made to the index to hopefully get a better understanding of the timing.

So what I've done with the help of a few incredibly helpful amazing Twitter followers is looked back at every company that has been added to the index since 2017.

It's about 77 different companies and then I looked at a few dates for each of these companies.

The date the inclusion in the index was first announced by the S&P, the date the inclusion

actually happened, and then the last earnings report before that inclusion, as well as the last 10Q or 10K filing

with the SEC before inclusion as well. Having these dates allows us to measure the time between

them, for example, from announcement to inclusion

or from the final earnings report to the announcement, so we can number one, look for trends,

and number two, see if there is anything we can apply to Tesla.

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