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Why Fisker Jumped 9% on Wednesday

TheMotleyFool

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Shares of electric car company Fisker (NYSE: FSR) ended Wednesday's trading up 9.1%, logging its best close since late March following news that the company was being added to the Russell 3000 index. At one point during the day shares were up as much as 10%.

While not a requisite for a stock to perform well, being part of a well-recognized market index like the Russell 3000 bolsters the bullish case for most stocks. In addition to drawing attention to the company, an inclusion in a key index means mutual funds and exchange-traded funds will soon be adding Fisker to their funds' investment pools. This wave of buying, in turn, can drive up the price of the shares in question.

Image source: Getty Images.

Source Fool.com

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