SMCI Index Inclusion & other musings

WHEN NONE DOES ANY WORK, WHAT’S ACTUALLY IN THE PRICE?

In a shocking turn of events to everyone except those reading Shrubstack, Super Micro Computer (SMCI) will be admitted in the S&P 500 on March 18th! The stock surged in the Friday post-market.

This was flagged as a possible scenario in “The Realization of Cannibalization & Other Red Flags” as per below:

I went out on a limb on Twitter in the past to say that SMCI will peak once it enters the S&P 500.

Given the actual inclusion date is March 18th, the stock has plenty of time to completely obliterate any monkeys caught short. After the index addition, the Passive monkeys will end up owning the stock in a hyper-inflated price and be grateful about it too.

I will be tempted to switch from a positive view to a negative view on the day, depending on how this plays out. But before I jump the gun with any trading strategies, I thought I should revisit a couple of precedents in index additions, so I don’t end being the monkey myself.