Installing XCode on external drive in MacOS Sequoia

Pretty much the title. Since MacOS Sequoia now allows you to install large apps on external drive from App Store directly, Has anyone tried installing and running? I've seen past posts about people having issues when working with XCode in external storage and it was tricky to make it work. I'm thinking of buying a M.2 SSD enclosure and 2TB SSD for the new mac mini I was wondering how can I run XCode fully from there.