Editing S&P 500 (section)

==Selection criteria==
Like other indices managed by [[S&P Dow Jones Indices]], but unlike indices such as the [[Russell 1000 Index]] 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 the following primary criteria:<ref name=S&P500Methodology/>
# [[Market capitalization]] - Market capitalization must be greater than or equal to US$20.5 billion (effective on January 2, 2025).<ref name="sp20250102">{{cite web |url = https://www.spglobal.com/spdji/en/documents/indexnews/announcements/20250102-1476019/1476019_2025janmktcapguidelines.pdf |title=S&P Dow Jones Indices Announces Update to S&P Composite 1500 Market Cap Guidelines | work=[[S&P Global]] |date=January 2, 2025}}</ref> These market cap eligibility criteria are for addition to an index, not for continued membership. As a result, an index constituent that appears to violate criteria for addition to that index is not removed unless ongoing conditions warrant an index change.<ref name="sp20250102"/>  
# [[Market liquidity]] and [[public float]]{{snd}}Annual dollar value traded to float-adjusted market capitalization is greater than 0.75.<ref name="sp20230104">{{cite web |url=https://www.spglobal.com/spdji/en/documents/indexnews/announcements/20230104-1460758/1460758_spcomposite1500indexmktcapfalrconsultationresults1-4-2023.pdf |title=S&P Dow Jones Indices Announces Update to S&P Composite 1500 Market Cap Guidelines |date=January 4, 2022 | work=[[S&P Global]] }}</ref>
# [[Volume (finance)|Volume]]{{snd}}Minimum monthly trading volume of 250,000 shares in each of the six months leading up to the evaluation date
# [[Stock exchange]]{{snd}}Must be publicly listed on the [[New York Stock Exchange]] (including [[NYSE Arca]] or [[NYSE American]]), [[Nasdaq]] (Nasdaq Global Select Market, Nasdaq Select Market or the Nasdaq Capital Market) or [[Cboe Global Markets|Cboe]] (Cboe BZX, Cboe BYX, Cboe EDGA or Cboe EDGX).
# [[Domicile (law)|Domicile]]{{snd}}The company must have its primary listing on a U.S. exchange.<ref>{{cite web |url=https://corporatefinanceinstitute.com/resources/equities/sp-500-index/ |title=S&P 500 Index|publisher= [[Corporate Finance Institute]]}}</ref>
# Securities that are ineligible for inclusion in the index are [[limited partnership]]s, [[master limited partnership]]s and their [[investment trust]] units, [[OTC Bulletin Board]] issues, [[closed-end fund]]s, [[exchange-traded fund]]s, [[Exchange-traded note]]s, [[royalty trust]]s, [[tracking stock]]s, [[preferred stock]], [[unit trust]]s, [[Warrant (finance)|equity warrants]], [[convertible bond]]s, [[investment trust]]s, [[American depositary receipt]]s, and [[American depositary share]]s.<ref name=S&P500Methodology/>

A stock may rise in value when it is added to the index since [[index fund]]s must purchase that stock to continue tracking the index.<ref>{{cite web | url=https://www.nber.org/digest/nov13/w19290.html | title=Stock Price Reactions to Index Inclusion | first=Jay | last=Fitzgerald | publisher=[[National Bureau of Economic Research]]}}</ref><ref>{{cite news | url=https://www.usatoday.com/story/money/columnist/krantz/2013/07/05/stocks-soar-added-sp-500/2447185/ | title=Do stocks soar if they get into the S&P 500? | first=Matt | last=Krantz | work=[[USA TODAY]] | date=July 5, 2013}}</ref>

A study published by the [[National Bureau of Economic Research]] in October 2021 alleged that companies' purchases of ratings services from [[S&P Global]] appear to improve their chance of entering the S&P 500 index, even if they are not the best fit per the rules.<ref>{{Cite web | url=https://www.nber.org/papers/w29365 | title=Is Stock Index Membership for Sale? | last1=Kun Li | first1=Xin | first2=Shang-Jin | last2=Wei | publisher=[[National Bureau of Economic Research]] | date=October 2021}}</ref><ref>{{cite news |url=https://www.bloomberg.com/news/articles/2021-10-12/new-nber-study-asks-whether-s-p-500-membership-is-up-for-sale |title=S&P 500 Membership May Be 'For Sale,' NBER Research Suggests |work=[[Bloomberg News]] |last=Lee |first=Justina |date=October 12, 2021 | url-access=subscription}}</ref>