Shares of Telsa (TSLA) jumped more than 10% in the after-hours session on the news that the electric carmaker is set to join the S&P 500.
On Monday evening, the S&P Dow Jones Indices announced that Tesla will be added to the closely-followed stock index on Monday, Dec. 21 before the market opens to coincide with the December quarterly rebalance.
“Due to the large size of the addition, S&P Dow Jones Indices is seeking feedback through a consultation to the investment community to determine if Tesla should be added all at once on the rebalance effective date or in two separate tranches ending on the rebalance effective date,” S&P Dow Jones Indices said in its release.
The S&P 500 is a market-cap-weighted index comprised of “leading companies from leading industries” that represent “a broad cross-section” of the stock market.
To be eligible for inclusion in the benchmark, a company must have at least an $8.2 billion market cap, be “highly liquid,” have a public float of at least 50% of its outstanding shares, and its most recent quarterly earnings and the trailing four quarters must be positive. The index is maintained by a committee that meets monthly.
Tesla, which has a market cap of $386.82 billion, has seen its shares surge nearly 400% year-to-date.
The company Tesla will replace on the index will be named closer to the rebalance date.
Julia La Roche is a correspondent for Yahoo Finance. Follow her on Twitter.