One assumes the tracker funds today are working out the total value they should be holding of each listed stock given its new weighting. Would imagine there will be very few stocks where the funds don't have to either increase or decrease their holdings.
Guess they will then need to pass their orders on to their agents - who will then perhaps contact leading fund managers in each stock to work out a mutually acceptable price for the shares.
Could be a few days before they work their way down the list to Insmed. Until then we could see more of the same - a combination of Shorts covering and opportunistic investors buying, from day traders who are doing nothing more than betting on whether the price will go up or down during the next hour.
The viewpoint of the funds negotiating a price with the agents is likely to be much more focused.
Their combined holding of approximately 21 million shares would be reduced by one-third if they agreed to sell 7 million shares at $13 a share. (The retail holding would have some sort of impact on that).
They must have had a good reason to buy the shares in the first place. If good results in July trigger a flurry of analyst targets between $50 and $100, and the float has been reduced from 30 million shares to 23 million shares, they'll find it rather expensive to replace the shares they sold.