--- title: "SpaceX's Historic IPO: Forcibly Rewriting Index Rules, Retail Investors May Become Key to Pricing" type: "News" locale: "en" url: "https://longbridge.com/en/news/288201776.md" description: "SpaceX plans to pursue the largest IPO in history with a valuation of at least $1.8 trillion and a fundraising target of $75 billion. Its massive scale has forced major index providers like Nasdaq to urgently modify inclusion rules, significantly shortening the waiting period for index addition. Automatic buying demand from passive funds could reach $20 billion, with 30% of the shares slated for retail investors. This unprecedented capital feast will reshape Wall Street rules and determine the listing fate of AI unicorns like OpenAI" datetime: "2026-06-01T02:24:40.000Z" locales: - [zh-CN](https://longbridge.com/zh-CN/news/288201776.md) - [en](https://longbridge.com/en/news/288201776.md) - [zh-HK](https://longbridge.com/zh-HK/news/288201776.md) --- # SpaceX's Historic IPO: Forcibly Rewriting Index Rules, Retail Investors May Become Key to Pricing SpaceX's listing plan is reshaping the operational logic of Wall Street in an unprecedented manner. This rocket, satellite, and AI conglomerate helmed by Elon Musk is expected to raise more than twice the amount of any previous IPO in history. Its sheer size has forced market participants to reorganize around it—from rewriting index rules and calculating automatic buying by passive funds to early positioning by retail investors. According to a Bloomberg report on Monday, SpaceX targets a valuation of at least $1.8 trillion and plans to raise $75 billion. To accommodate this unprecedented deal, Nasdaq has modified its rules, **allowing SpaceX to join the Nasdaq 100 Index within just 15 trading days after its listing, whereas the previous minimum waiting period was three months.** FTSE Russell has adopted a similar approach; S&P Dow Jones Indices is also consulting on relevant rule revisions. If approved, the S&P 500 Index may open its doors to SpaceX. Bloomberg Intelligence analysts James Seyffart and Rob Du Boff estimate that **if S&P follows suit, automatic buying demand from passive funds for SpaceX will approach $20 billion, accounting for about one-quarter of this issuance size.** Meanwhile, SpaceX is considering reserving up to 30% of the issuance shares—with a potential scale of $22.5 billion—for retail investors, completely overturning the tradition of institutional investors dominating pricing in traditional IPOs. This arrangement could provide support for the stock price post-listing but has also raised concerns about subsequent liquidity. Owen Lamont, portfolio manager at Acadian Asset Management, stated, "I can't think of another IPO in my lifetime that would be more impactful." ## Index Rules Forced to Rewrite The arrival of SpaceX has placed unprecedented pressure on index inclusion rules originally designed to maintain market order. Nasdaq compressed the new stock waiting period for the Nasdaq 100 Index from three months to 15 trading days and introduced a market capitalization calculation adjustment mechanism for companies with low free float—increasing the market cap calculation multiplier for low-float stocks to three times. Nelson Griggs, President of Nasdaq, said in an interview with Bloomberg Television that this move is to ensure that the weight of low-float companies in the index is substantive and adjusts gradually over time, "This is effectively a guardrail." However, this series of changes is not without controversy. Lynn Martin, President of NYSE Group, the parent company of the New York Stock Exchange, publicly criticized Nasdaq's rule revisions as tailor-made to attract SpaceX's listing, stating bluntly, "From our perspective, market integrity is not a competitive dimension." Seyffart and Du Boff pointed out in their research report that **SpaceX plans to lift lock-up periods for insiders ahead of schedule. If S&P's proposal is approved, at least 90% of the locked-up shares will have been unlocked by then. This means shares cashed out by employees and early investors might be picked up precisely by index-tracking funds.** "These changes should not be taken lightly, as market participants are expressing their concerns," the two analysts wrote. Brian Hartigan, Global Head of ETF and Index Investing at Invesco—who manages two large ETFs, QQQ and QQQM, which track the Nasdaq 100—supported the direction of the rule adjustments: "The core of indexing is to capture the largest and most liquid securities representing the public market." ## Unprecedented Role for Retail Investors In the traditional IPO model, institutional investors receive allocations, retail investors catch the hype sentiment, and then enter the market to provide exit liquidity for institutions. SpaceX is overturning this logic. **Musk plans to reserve up to 30% of the issuance shares for ordinary investors, which is extremely rare in IPO history.** Janice Vines, a 65-year-old retired teacher from Ohio, has already purchased the ERShares Private-Public Crossover ETF (XOVR) as an early position and plans to invest another $20,000 directly when SpaceX lists. "My main goal is to buy some of SpaceX's IPO," she said. "Elon is a visionary, and I hope to ride his coattails into retirement." Steve Sosnick, Chief Strategist at Interactive Brokers, issued a warning regarding this arrangement. He pointed out that in traditional IPOs, retail entry is a key driver pushing up stock prices after listing, but once retail investors receive large allocations during the IPO stage, this subsequent buying momentum may weaken. "**You have to think about the extent to which they are allocating such a large volume of shares to individual investors at the expense of secondary market performance,**" he said. Sosnick also noted that due to limited cash in retail accounts, investors may need to sell existing holdings to free up funds to participate in SpaceX, potentially putting pressure on Tesla and Bitcoin. ## AI Narrative Drives Valuation Controversy SpaceX's appeal comes not only from its rocket business but also from Musk's narrative repositioning it as an "AI infrastructure company in rocket clothing." Jeff Muhlenkamp, fund manager at Muhlenkamp Fund, stated, "There is a reason all AI companies want to list this year: the current market atmosphere is very suitable for this type of story. We are in an environment that chases growth and chases stories." However, doubts regarding valuation cannot be ignored. Based on a target market capitalization of at least $1.8 trillion, SpaceX's price-to-sales ratio is approximately 93 times, which is 15 times the average of the Nasdaq 100. Roger Ibbotson, Professor Emeritus of Finance at Yale University, who has studied capital markets for over fifty years, believes SpaceX cannot escape the pattern of IPO stocks underperforming the broader market in the long run. **"Much of SpaceX's value lies in stories and narratives, but the problem is that these stories are ultimately difficult to deliver,"** he said. A Danish pension fund with $25 billion in assets explicitly stated it would not participate, with its Chief Investment Officer describing SpaceX's governance structure—where Musk will firmly control voting rights and board appointment powers—as "catastrophic." On the other hand, David Wagner, portfolio manager at Aptus Capital Advisors, plans to buy in batches during the first month after listing, betting that passive fund demand will push up the stock price. He cited Tesla as a warning to shorts: "Any fundamental investor who refuses to invest based on valuation has their reasons, but look at how many people bet wrong on Tesla. **Valuation is not important for SpaceX.**" ## Success or Failure Impacts Far Beyond One Company The outcome of SpaceX's listing will have a profound impact on the direction of the entire IPO market. AI unicorns like OpenAI and Anthropic are queuing up for large-scale listings, and SpaceX's success or failure will directly determine whether this door opens. Lamont stated, "**If it goes well, it could kick off a wave of large-scale issuances and unrestrained market frenzy; if it goes poorly, it could shut the door for OpenAI and Anthropic.**" The issue of SpaceX's industry classification remains unresolved, which will affect which index sector it is ultimately assigned to. The rocket business points to the industrial sector, but potential cloud service agreements with Anthropic worth nearly $45 billion and space data center plans could push it toward the technology sector. More than 20 ETFs linked to SpaceX have submitted applications this year, covering various types such as leveraged long, inverse, and options strategies. 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