- Tesla is being inducted into the S&P 500 today.
- Tesla CEO Elon Musk has seen his net worth increase by nearly $US65 billion since the announcement that Tesla would join the index, on November 16.
- But Musk, now the world’s second-richest man, is relatively “cash-poor” because his fortune is so closely tied to his shareholdings.
- Visit Business Insider’s homepage for more stories.
Tesla is being inducted into the S&P 500 today, causing Elon Musk’s net worth to skyrocket yet again.
His fortune has been on a wild upswing since the company was named for inclusion on the S&P 500 on November 16, becoming its largest new addition.
On the day of the announcement, Musk’s net worth was sitting pretty at an estimated $US102.2 billion, according to Bloomberg’s Billionaire Index. By December 21, the day Tesla was inducted into the S&P 500, it had increased by $US64.8 billion to $US167 billion.
The chart below highlights the steady climb of Musk’s net worth over the past 30 days as Tesla’s S&P 500 debut approached.
Following the announcement of Tesla’s inclusion, Musk’s net worth grew overnight by $US11.8 billion to hit $US114 billion, and he eclipsed Facebook founder Mark Zuckerberg to take third place in the global wealth ranking, Bloomberg reported.
It rose again the following day, to $US120 billion, when Tesla shares spiked 10% after Morgan Stanley gave the stock an overweight rating, according to Bloomberg. That means within the first three days of the announcement, Musk’s net worth climbed by nearly $US18 billion.
By November 24, Musk had unseated Bill Gates as the world’s second-richest person, with a net worth of $US128 billion. And by the end of the month, Musk’s net worth had soared to $US142 billion. The weekend ahead of Tesla’s S&P 500 debut, Musk’s net worth hit $US158 million, only to increase by nearly $US10 billion over the weekend to its current $US167 billion.
But this doesn’t mean Musk’s wealth easily translates to spending power.
Musk famously earns his billions without taking a paycheck from Tesla, refusing his $US56,000 minimum salary as CEO every year. In January 2018, Tesla announced it would pay Musk nothing for the next 10 years â€” no salary, bonuses, or stock â€” until the company reached a $US100 billion market cap.
Instead, Musk has a complicated compensation package that will result in a massive payday once he achieves ambitious performance goals. That leaves Musk relatively “cash-poor,” with a fortune tied to his stock in Tesla and his other companies, SpaceX and The Boring Company. To spend that wealth, he’d have to sell stock options that have vested into actual equity.
Regardless, if Musk’s net worth continues to soar the way it has in the past 30 days, he might just be here to stay as the world’s second-richest person.
Tesla did not immediately respond to a request for comment.