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Well that's a garbage take. This guy fundamentally doesn't seem to understand what an index is. The S&P 500 doesn't (well, shouldn't) make value judgments about

Well that's a garbage take. This guy fundamentally doesn't seem to understand what an index is. The S&P 500 doesn't (well, shouldn't) make value judgments about the quality of the companies in it. It's just the 500 largest companies on US exchanges. That's what people who use it want. Really, the big problem here was that it wasn't already included on the S&P 500 years ago, so that all of the gains leading up to this point could have been shared with passive investors. It's satisfied the market cap requirement for awhile, but not the profitability requirement, which clearly didn't work well in this case.

SilasX 6y ago
Passive investors could have bought a broader market index than the S&P 500.
- fakedang 6y ago
  The S&P 500 indices far outweigh other indices in the ETF space. Other ETFs tend to be for more risky domains. I agree with GP, Tesla should have been included way back, during the first jump to 250.
areyousure 6y ago
> The S&P 500 doesn't (well, shouldn't) make value judgments about the quality of the companies in it. It's just the 500 largest companies on US exchanges. That's what people who use it want. "Like other indices managed by S&P Dow Jones Indices, but unlike indices such as the Russell 1000 which are strictly rule-based, the components of the S&P 500 index are selected by a committee. When considering the eligibility of a new addition, the committee assesses the company's merit using eight primary criteria: market capitalization, liquidity, domicile, public float, Global Industry Classification Standard and representation of the industries in the economy of the United States, financial viability, length of time publicly traded, and stock exchange." https://en.wikipedia.org/wiki/S%26P_500_Index#Selection_criteria https://en.wikipedia.org/wiki/S%26P_500_Index#Selection_crit...

SilasX 6y ago

Passive investors could have bought a broader market index than the S&P 500.

fakedang 6y ago
The S&P 500 indices far outweigh other indices in the ETF space. Other ETFs tend to be for more risky domains. I agree with GP, Tesla should have been included way back, during the first jump to 250.

areyousure 6y ago

> The S&P 500 doesn't (well, shouldn't) make value judgments about the quality of the companies in it. It's just the 500 largest companies on US exchanges. That's what people who use it want. "Like other indices managed by S&P Dow Jones Indices, but unlike indices such as the Russell 1000 which are strictly rule-based, the components of the S&P 500 index are selected by a committee. When considering the eligibility of a new addition, the committee assesses the company's merit using eight primary criteria: market capitalization, liquidity, domicile, public float, Global Industry Classification Standard and representation of the industries in the economy of the United States, financial viability, length of time publicly traded, and stock exchange." https://en.wikipedia.org/wiki/S%26P_500_Index#Selection_criteria https://en.wikipedia.org/wiki/S%26P_500_Index#Selection_crit...