To join, a company must have been profitable for the last four quarters as a whole and in the most recent quarter specifically with a market cap of at least $22.7 billion. It also must meet float and volume criteria. When stocks are added to the S&P 500, they typically experience a short-term price surge known as the "index effect" as massive mutual funds and ETFs are forced to buy the shares to mirror the benchmark.
Historically, newly added S&P 500 stocks see stronger trading volumes, and short-term price spikes as funds adjust their holdings. This year, several companies tied to the artificial intelligence boom are benefiting from that trend, including Marvell Technology, Flex Ltd., and Lumentum Holdings. After all, as demand for AI infrastructure, networking chips, and optical connectivity solutions accelerates, these stocks are attracting attention from both Wall Street and retail investors looking for the next major growth opportunity.
Look at Marvell Technology (NASDAQ: MRVL), for example.
On the morning of June 8, the company announced it would join the S&P 500 on June 22. As a result, the stock soared about 9% in premarket.
Fueling even more momentum for the stock, Jensen Huang, CEO of NVIDIA, recently described Marvell as a potential future trillion-dollar company. He highlighted the company’s networking and connectivity chips, which play a critical role in modern AI data centers where thousands of processors must rapidly exchange data to perform complex computing tasks.
Marvell currently has a market cap of $230.4 billion and just posted strong earnings.
"Marvell delivered record first-quarter fiscal 2027 revenue of $2.418 billion, up 28% year-over-year, and guided second-quarter revenue to $2.7 billion at the mid-point, representing 35% year-over-year growth. We expect revenue growth to continue accelerating each quarter throughout fiscal 2027, driven by continued strength in our data center business," said Marvell CEO and Chairman Matt Murphy, as quoted in a company press release.
Imagine that you are an event trader, and that day after day sellers have dominated the trading action, driving the market to greatly oversold levels. Recent economic indicators have been negative, which means the economy is crawling along.
Now imagine that before the bell, Microsoft announces spectacular earnings and say its future earnings appear strong as well. The market is oversold and there are no prevailing conflicts or uncertainties. The market will very likely go up, perhaps way up.
It’s time for you to act, to jump into an index call option. The first step is to decide which call to buy. If all goes well, all the indexes will go up and you will earn a profit no matter which index you choose. In my opinion, however, some indexes are better than others for event traders. I rank them as follows, beginning with the best.
A Straightforward Approach to Trading Weekly Options
As stated in the Wealth Building with Weekly Options book, the strategy depends on locating liquid, high dollar, fast moving stock candidates. In addition, it is important to be aware of the overall market environment.
The content of this newsletter endeavors to support you and those strategy goals. The newsletter comes out on Wednesday evenings since Thursday is the day of new weekly option listings.
This week: The stock market took a broad hit on Wednesday as energy prices and the cost of borrowing for the long term rose. Yet a mild drop in turnover on both main exchanges indicated that overall selling was limited.
Among the key indexes, the Russell 2000 bore the brunt of the profit-taking session. It fell 1.3% to
2,893, notching a third decline in four sessions. A more concentrated version of small-cap stocks,
namely the S&P SmallCap 600, sank just under 0.9% to 1,681. View a daily chart on MarketSurge, and you’ll see that the 600 is having a tough time piercing the 1,700 level.
Stock Market Today
The Nasdaq composite briefly looked set to rise for a 10th straight session. Instead, it followed the rest of the stock market lower, losing 0.9% to 26,853. The S&P 500 also snapped a nine session winning streak, down 0.7% to 7,553. A 1.2% slide by the Dow Jones Industrial Average masked nifty gains by the likes of components Walmart (WMT), Amgen (AMGN), and Caterpillar (CAT), whose gas turbines are getting deployed at data centers to provide critical power.
"The market makes no sense right now" - New York Times
Almost every trader I talk to agrees with that headline. The market keeps screaming higher despite the war in Iran and despite frothy valuations.
On the one hand, putting any money into the market right now feels like buying at the absolute tippity top. But on the other hand... it’s felt that way for years and it’s possible the market screams even higher.
That’s why we’re hosting Wendy Kirkland for a special live training session where she’s going to reveal her strategy for going after profits even during insane market conditions.
NOTICE: Auto-trading, or any broker or advisor-directed type of trading, is not supported or endorsed by TradeWins Publishing (“TradeWins”). The information provided by TradeWins in its various materials, including trading recommendations, newsletters and educational publications is not customized or personalized for any particular person or risk profile. Past results are not necessarily indicative of future results. Results presented can vary and may not be typical for all subscribers. There are substantial risks involved with investing in the stock and options market, including the risk of total loss. You should only trade or invest "risk capital" - funds you can afford to lose.