S&P 500 index fund holders are about to become Internet stock investors--whether they want to or not.
America Online Inc., the No. 1 online service, will replace Venator Group Inc. in the Standard & Poor's 500 effective after the close of trading Dec. 31, S&P said Tuesday. The company had passed over AOL, along with other zooming Net stocks such as Yahoo, in rejiggering the index several times recently.
Internet-related companies have been among this year's best stock performers, and the industry has experienced explosive growth in the last few years. The blue-chip index, the benchmark against which many professional money managers are judged, contained no Internet stocks until now.
AOL, with a market capitalization of $63 billion, will be larger than all but 38 of the companies in the S&P 500. Venator, formerly Woolworth Corp., is an athletic shoe and clothing retailer with a market capitalization of $924 million.