Classic algo-driven market absurdity.
$RDDT tanks 30% two weeks ago on actual fundamentals — earnings miss, guidance weak, business reality check.
Today? Pops 15% because it's getting added to the S&P 500. Not because anything changed with the business. Just passive flows, index rebalancing, and forced buying from funds that track the benchmark.
This is what happens when trillions sit in passive ETFs. Price discovery breaks. Fundamentals don't matter until they suddenly do again.
The inclusion trade is real, but it's mechanical — not a vote of confidence in Reddit's actual business model. Once the rebalance settles, gravity tends to reassert itself if the fundamentals haven't improved.
Watch how this plays out over the next few weeks. If $RDDT can't hold these levels after the index buying fades, you'll know exactly what that pop was worth.
$RDDT tanks 30% two weeks ago on actual fundamentals — earnings miss, guidance weak, business reality check.
Today? Pops 15% because it's getting added to the S&P 500. Not because anything changed with the business. Just passive flows, index rebalancing, and forced buying from funds that track the benchmark.
This is what happens when trillions sit in passive ETFs. Price discovery breaks. Fundamentals don't matter until they suddenly do again.
The inclusion trade is real, but it's mechanical — not a vote of confidence in Reddit's actual business model. Once the rebalance settles, gravity tends to reassert itself if the fundamentals haven't improved.
Watch how this plays out over the next few weeks. If $RDDT can't hold these levels after the index buying fades, you'll know exactly what that pop was worth.