Benjamin Felix

Now that S&P 1500 composite has a different set of rules.

than the S&P total market index.

So the S&P total market index allows for inclusion of IPOs within five days for stocks that meet certain criteria.

Pretty interesting, two very different methodologies, even within S&P indices.

Now that within five days, that's sort of

near immediate inclusion.

That's called fast track entry.

So that's a concept that is pretty important to understand on this topic.

Basically, stocks that meet certain criteria can be eligible for near immediate inclusion in some total market indices.

I mentioned S&P 500 has historically required shares to trade for a year.

Yeah, so there's this article from Bloomberg saying that S&P may be considering an S&P 500 rule change to accelerate the inclusion of some of these big IPOs like SpaceX.

When I wrote these notes originally, NASDAQ was considering, so I had my notes in past tense, but they've since adopted similar changes for the NASDAQ 100 to accelerate inclusion of some of these big IPOs.

And we can talk more about the details of those changes.

There's some interesting stuff there.

The implications for index fund investors are pretty important.

This paper that I want to talk about comes from Marco Salmon, who we've had on this podcast and talked to him about this paper on the podcast.

His 2025 paper looks at how fast track entry into CRSP.

That's the Center for Research and Security Prices, Indices, Effects, Stock Returns, and IPO Deal Structure.

This is fascinating stuff.

Index funds have become so big that index inclusion affects stock prices.