​​WHAT COMPANIES COULD BE LISTED IN THE S&P 500 INDEX AND HOW OFTEN THE LIST IS UPDATED

A special index committee manages the S&P 500 index and carries out the index rebalancing every quarter. The stocks are selected by their liquidity, size and industry. However, it is important to remember that the committee can make an off-schedule decision about adding a company to the list.
👉 Such a ‘manual’ selection of companies makes S&P 500 different from Russel, the stocks of which are selected by a formula.

In order for a company to be listed in the S&P 500 index, it should meet the following criteria:
✔️ it should be an American company;
✔️ the company capitalization should be more than USD 8.2 billion;
✔️ more than 50% of all stocks for the amount of more than USD 4.2 billion should be in free market circulation;
✔️ the total profit for the past 4 quarters should be positive and the individual profit in each recent quarter should be positive;
✔️ the stocks should correspond to the liquidity criteria - minimum 250,000 stocks have been traded every month for the past 6 months and their annual dollar value traded should be more than USD 1.

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