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Chris W. Rea
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The S&P 500 index is maintained by S&P Dow Jones Indices, a division of McGraw Hill Financial. Changes to the index are made periodically, as needed. For Facebook, you'll find it mentioned in this December 11, 2013 press release (PDF). Quote:

New York, NY, December 11 , 2013 – S&P Dow Jones Indices will make the following changes to the S&P 100, S&P 500, MidCap 400 and S&P SmallCap 600 indices after the close of trading on Friday, December 20:

  • Facebook Inc. (NASD:FB) will replace The Williams Companies Inc. (NYSE:WMB) in the S&P 100, and Facebook will replace Teradyne Inc. (NYSE:TER) in the S&P 500 [...]

You can find out more about the S&P 500 index eligibility criteria from the S&P U.S. Indices methodology document (PDF). See pages 5 and 6:

Eligibility Criteria

Additions - S&P 500, S&P MidCap 400 and S&P SmallCap 600 Market Capitalization.

Additions - S&P 500, S&P MidCap 400 and S&P SmallCap 600 Market Capitalization.

Market Capitalization - [...]
  

Liquidity - [...]
  

Domicile - [...]
  

Public Float - [...]
  

Sector Classification - [...]
  

Financial Viability - Usually measured as four consecutive quarters of positive as reported earnings. [...]
  

Treatment of IPOs - Initial public offerings should be seasoned for 6 to 12 months before being considered for addition to an index.
  

Eligible Securities - [...]
Deletions - [...]
[...]

Timing of Changes

Timing of Changes

Changes to the U.S. indices other than the TMIX are made as needed, with no annual or semi-annual reconstitution. [...]

LabCorp may have a smaller market cap than Facebook, but Facebook didn't meet all of the eligibility criteria (for– for instance, see the above note about "Treatment of IPOs") until recently.

Note also that "Initial public offerings should be seasoned for 6 to 12 months" implies somebody at S&P makes a decision as to the exact when.

As such, I would say, no, there is no "simple rule or formula", just the methodology above as applied by the decision-makers at S&P.

The S&P 500 index is maintained by S&P Dow Jones Indices, a division of McGraw Hill Financial. Changes to the index are made periodically, as needed. For Facebook, you'll find it mentioned in this December 11, 2013 press release (PDF). Quote:

New York, NY, December 11 , 2013 – S&P Dow Jones Indices will make the following changes to the S&P 100, S&P 500, MidCap 400 and S&P SmallCap 600 indices after the close of trading on Friday, December 20:

  • Facebook Inc. (NASD:FB) will replace The Williams Companies Inc. (NYSE:WMB) in the S&P 100, and Facebook will replace Teradyne Inc. (NYSE:TER) in the S&P 500 [...]

You can find out more about the S&P 500 index eligibility criteria from the S&P U.S. Indices methodology document (PDF). See pages 5 and 6:

Eligibility Criteria

Additions - S&P 500, S&P MidCap 400 and S&P SmallCap 600 Market Capitalization.

Market Capitalization - [...]
 Liquidity - [...]
 Domicile - [...]
 Public Float - [...]
 Sector Classification - [...]
 Financial Viability - [...]
 Treatment of IPOs - Initial public offerings should be seasoned for 6 to 12 months before being considered for addition to an index.
 Eligible Securities - [...]
Deletions - [...]
[...]

Timing of Changes

Changes to the U.S. indices other than the TMIX are made as needed, with no annual or semi-annual reconstitution. [...]

LabCorp may have a smaller market cap than Facebook, but Facebook didn't meet the eligibility criteria (for instance, see the above note about "Treatment of IPOs") until recently.

The S&P 500 index is maintained by S&P Dow Jones Indices, a division of McGraw Hill Financial. Changes to the index are made periodically, as needed. For Facebook, you'll find it mentioned in this December 11, 2013 press release (PDF). Quote:

New York, NY, December 11 , 2013 – S&P Dow Jones Indices will make the following changes to the S&P 100, S&P 500, MidCap 400 and S&P SmallCap 600 indices after the close of trading on Friday, December 20:

  • Facebook Inc. (NASD:FB) will replace The Williams Companies Inc. (NYSE:WMB) in the S&P 100, and Facebook will replace Teradyne Inc. (NYSE:TER) in the S&P 500 [...]

You can find out more about the S&P 500 index eligibility criteria from the S&P U.S. Indices methodology document (PDF). See pages 5 and 6:

Eligibility Criteria

Additions - S&P 500, S&P MidCap 400 and S&P SmallCap 600 Market Capitalization.

Market Capitalization - [...] 

Liquidity - [...] 

Domicile - [...] 

Public Float - [...] 

Sector Classification - [...] 

Financial Viability - Usually measured as four consecutive quarters of positive as reported earnings. [...] 

Treatment of IPOs - Initial public offerings should be seasoned for 6 to 12 months before being considered for addition to an index. 

Eligible Securities - [...]
[...]

Timing of Changes

Changes to the U.S. indices other than the TMIX are made as needed, with no annual or semi-annual reconstitution. [...]

LabCorp may have a smaller market cap than Facebook, but Facebook didn't meet all of the eligibility criteria – for instance, see the above note about "Treatment of IPOs" until recently.

Note also that "Initial public offerings should be seasoned for 6 to 12 months" implies somebody at S&P makes a decision as to the exact when.

As such, I would say, no, there is no "simple rule or formula", just the methodology above as applied by the decision-makers at S&P.

added 287 characters in body
Source Link
Chris W. Rea
  • 31.8k
  • 17
  • 103
  • 190

The S&P 500 index is maintained by S&P Dow Jones Indices, a division of McGraw Hill Financial. Changes to the index are made periodically, as needed. For Facebook, you'll find it mentioned in this December 11, 2013 press release (PDF). Quote:

New York, NY, December 11 , 2013 – S&P Dow Jones Indices will make the following changes to the S&P 100, S&P 500, MidCap 400 and S&P SmallCap 600 indices after the close of trading on Friday, December 20:

  • Facebook Inc. (NASD:FB) will replace The Williams Companies Inc. (NYSE:WMB) in the S&P 100, and Facebook will replace Teradyne Inc. (NYSE:TER) in the S&P 500 [...]

You can find out more about the S&P 500 index eligibility criteria from the S&P U.S. Indices methodology document (PDF). See pages 5 and 6:

Eligibility Criteria

Additions - S&P 500, S&P MidCap 400 and S&P SmallCap 600 Market Capitalization.

Market Capitalization - [...]
Liquidity - [...]
Domicile - [...]
Public Float - [...]
Sector Classification - [...]
Financial Viability - [...]
Treatment of IPOs - [..Initial public offerings should be seasoned for 6 to 12 months before being considered for addition to an index.]
Eligible Securities - [...]
Deletions - [...]

[
[...]

Timing of Changes

Changes to the U.S. indices other than the TMIX are made as needed, with no annual or semi-annual reconstitution. [...]

LabCorp may have a smaller market cap than Facebook, but Facebook didn't meet the eligibility criteria (for instance, see the above note about "Treatment of IPOs") until recently.

The S&P 500 index is maintained by S&P Dow Jones Indices, a division of McGraw Hill Financial. Changes to the index are made periodically, as needed. For Facebook, you'll find it mentioned in this December 11, 2013 press release (PDF). Quote:

New York, NY, December 11 , 2013 – S&P Dow Jones Indices will make the following changes to the S&P 100, S&P 500, MidCap 400 and S&P SmallCap 600 indices after the close of trading on Friday, December 20:

  • Facebook Inc. (NASD:FB) will replace The Williams Companies Inc. (NYSE:WMB) in the S&P 100, and Facebook will replace Teradyne Inc. (NYSE:TER) in the S&P 500 [...]

You can find out more about the S&P 500 index eligibility criteria from the S&P U.S. Indices methodology document (PDF). See pages 5 and 6:

Eligibility Criteria

Additions - S&P 500, S&P MidCap 400 and S&P SmallCap 600 Market Capitalization.

Market Capitalization - [...]
Liquidity - [...]
Domicile - [...]
Public Float - [...]
Sector Classification - [...]
Financial Viability - [...]
Treatment of IPOs - [...]
Eligible Securities - [...]
Deletions - [...]

[...]

Timing of Changes

Changes to the U.S. indices other than the TMIX are made as needed, with no annual or semi-annual reconstitution. [...]

The S&P 500 index is maintained by S&P Dow Jones Indices, a division of McGraw Hill Financial. Changes to the index are made periodically, as needed. For Facebook, you'll find it mentioned in this December 11, 2013 press release (PDF). Quote:

New York, NY, December 11 , 2013 – S&P Dow Jones Indices will make the following changes to the S&P 100, S&P 500, MidCap 400 and S&P SmallCap 600 indices after the close of trading on Friday, December 20:

  • Facebook Inc. (NASD:FB) will replace The Williams Companies Inc. (NYSE:WMB) in the S&P 100, and Facebook will replace Teradyne Inc. (NYSE:TER) in the S&P 500 [...]

You can find out more about the S&P 500 index eligibility criteria from the S&P U.S. Indices methodology document (PDF). See pages 5 and 6:

Eligibility Criteria

Additions - S&P 500, S&P MidCap 400 and S&P SmallCap 600 Market Capitalization.

Market Capitalization - [...]
Liquidity - [...]
Domicile - [...]
Public Float - [...]
Sector Classification - [...]
Financial Viability - [...]
Treatment of IPOs - Initial public offerings should be seasoned for 6 to 12 months before being considered for addition to an index.
Eligible Securities - [...]
Deletions - [...]
[...]

Timing of Changes

Changes to the U.S. indices other than the TMIX are made as needed, with no annual or semi-annual reconstitution. [...]

LabCorp may have a smaller market cap than Facebook, but Facebook didn't meet the eligibility criteria (for instance, see the above note about "Treatment of IPOs") until recently.

Source Link
Chris W. Rea
  • 31.8k
  • 17
  • 103
  • 190

The S&P 500 index is maintained by S&P Dow Jones Indices, a division of McGraw Hill Financial. Changes to the index are made periodically, as needed. For Facebook, you'll find it mentioned in this December 11, 2013 press release (PDF). Quote:

New York, NY, December 11 , 2013 – S&P Dow Jones Indices will make the following changes to the S&P 100, S&P 500, MidCap 400 and S&P SmallCap 600 indices after the close of trading on Friday, December 20:

  • Facebook Inc. (NASD:FB) will replace The Williams Companies Inc. (NYSE:WMB) in the S&P 100, and Facebook will replace Teradyne Inc. (NYSE:TER) in the S&P 500 [...]

You can find out more about the S&P 500 index eligibility criteria from the S&P U.S. Indices methodology document (PDF). See pages 5 and 6:

Eligibility Criteria

Additions - S&P 500, S&P MidCap 400 and S&P SmallCap 600 Market Capitalization.

Market Capitalization - [...]
Liquidity - [...]
Domicile - [...]
Public Float - [...]
Sector Classification - [...]
Financial Viability - [...]
Treatment of IPOs - [...]
Eligible Securities - [...]
Deletions - [...]

[...]

Timing of Changes

Changes to the U.S. indices other than the TMIX are made as needed, with no annual or semi-annual reconstitution. [...]