According to CoinMeta, Reddit ( NYSE : RDDT ) will officially join the S&P 500 index on Tuesday, replacing AvalonBay Communities. S&P P Dow Jones Indices announced on Thursday evening that AvalonBay will withdraw from the index due to being acquired by Equity Residential. Investors reacted positively to this news, and on Friday, Reddit's stock price rose by about 13%, approaching $179. Historical data shows that companies that join the S&P 500 usually experience an increase in stock price, but this effect has gradually weakened over the past few decades. Research indicates that between 1980 and 2020, the average abnormal returns for companies that joined the S&P 500 gradually decreased, and this effect almost disappeared in the 2010s. Nevertheless, Reddit's stock price may still rise due to the forced purchases by passive funds. Reddit's revenue has grown by more than 60% in the past 12 months, reaching $2.8 billion, and the company has solid profitability with net income of about $871 million. However, management recently stated that fluctuations in search traffic may affect future growth.