A Bad Year for S&P 500 Additions

October 2, 2008

Hickey and Walters (Bespoke) submit:

People often say that when a stock gets added to the S&P 500, it’s often the kiss of death, because by the time S&P adds it, the story is already known (examples include tech stocks in 2000, homebuilders in 2005, etc). Well, 2008 has been no different. Of the 20 stocks added to the index during the first three quarters of 2008, only six (30%) have outperformed the index since being added. And even that stat is misleading since three of these stocks (LO, PM, and SNI) were units of existing S&P 500 companies. Like the rest of us, for the Index committee at Standard and Poor’s, this year can’t end soon enough!

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