Elon Musk is now richer than Mark Zuckerberg as Tesla shares soars

South African-born Elon Musk recently leapt past Facebook’s Mark Zuckerberg to become the world’s third-richest person after Tesla snagged a spot in the stock market index S&P 500, turbocharging the electric-car maker’s stock.

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Musk vs Zuckerberg

According to the New York Post, Tesla shares on Tuesday 17 November jumped more than 8% on news that the benchmark index is finally adding Tesla. The change will require big investment firms that duplicate the index to buy the company’s shares – and could make the S&P more volatile in the future, experts say.

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The jump added more than $7.8 billion to Musk’s wealth, according to Bloomberg’s Billionaires Index, leaving Musk’s net worth on Tuesday at nearly $110 billion. That still lags Amazon CEO Jeff Bezos and Microsoft magnate Bill Gates, who are worth $185 billion and $127 billion, respectively.

Nevertheless, it’s comfortably ahead of Zuckerberg, whose net worth slipped to $104 billion as Facebook shares slid 1.4% to $275.

Earlier this year, Musk also surpassed Zuckerberg but Musk’s net worth tanked after the S&P delivered a surprise snub to Tesla a week later, sending the company’s shares tumbling 20%.

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The richest people in the world

But, despite the stumbles, Musk has seen his wealth grow by more than $82 billion this year, a bigger gain than anyone else on Bloomberg’s list of the world’s 500 richest people. Like Zuckerberg, the size of Musk’s fortune is heavily dependent on the stock price of his company, which could climb even further ahead of its S&P 500 debut on 21 December. The shares are up fivefold so far this year.

“I don’t think we’ll ever know why they decided not to include Tesla [in September]. Their process is very tightly guarded,” said Garrett Nelson, an analyst at an independent investment research firm, CFRA. “Even the companies themselves don’t know about changes to their index before they are announced.”

Still, Nelson added that inclusion in the S&P 500 won’t change anything for Tesla from an operational perspective and that investors are still looking to see the automaker’s growth and execution story continue.

The Giving Pledge

According to reports, Musk has signed the Giving Pledge, the philanthropic initiative created by Gates and investor Warren Buffett to encourage the world’s richest people to commit to giving away at least half their wealth to charity. However, the Musk Foundation, a charity he founded with his brother in 2002, has given away less than $100m according to regulatory filings.