Robinhood (HOOD.US) and AppLovin (APP.US) shares are down by approximately 5% today, partially erasing recent gains. Just a few trading sessions before Friday's index composition review, some investors had speculatively opened positions in these companies' stocks, hoping they would be added to the main S&P 500 index. Such a decision would have boosted demand for their shares, notably from index-replicating ETFs, and increased interest in the stocks among a broader group of investors.
However, on Friday, the decision was made to keep the S&P 500 index composition unchanged. Consequently, we are seeing price gaps in the companies' stock quotes today due to investor disappointment with S&P Dow Jones Indices' decision.
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Robinhood's stock approached its highest value since 2021 during Friday's rally. Source: xStation
