Reddit stock set for a major surge after S&P 500 inclusion on August 18, 2026, despite some risks.

Reddit stock has dropped over 22% since early July, making it an attractive buy ahead of its scheduled inclusion in the S&P 500 index on August 18, 2026. This inclusion typically triggers automatic fund buying and significant price spikes, as seen with Palantir's 20% rally after its S&P 500 entry in 2024. Reddit shares have already started rising in anticipation, up nearly 12% in pre-market trading. However, investors should be cautious as the recent rally could lead to profit-taking and the stock may become overbought. Long-term risks include potential market-wide downturns driven by aging Baby Boomer investors selling off index funds. Still, this event presents one of the best buying opportunities for Reddit stock in the near future.