No longer will there be a year of price discovery for index funds, 15 days. Meaning index funds have to buy it at the peak of the hype cycle. Will be a huge wealth transfer from mom and pop retirement accounts to the ultra wealthy.

They’re taking everything thats not nailed down. A wealth tax is the only way, it cannot continue like this.

There are also perfectly ordinary situations in which this pattern is used to imply the influence of an unknown party. "They built a bridge over the river." Clearly the speaker does not believe that bridges over rivers construct themselves. She doesn't need to know who built the bridge.

This excuse only works if who built the bridge isn't central to the discussion. Otherwise this is just generic conspiratorial thinking that we're being oppressed by The Elites™.

After 20+ years in the market, today I learned: "The S&P 500 is a float-adjusted, market-capitalization-weighted index."

So presumably an S&P 500 index fund is not disadvantaged, since it is tracking a float-adjusted index, i.e. the weight of SpaceX will be tiny if its float is tiny.

Or, is there a nuance that I'm missing?

Nasdaq already caved. FTSE and S&P are supposedly considering it.

https://www.economist.com/leaders/2026/03/31/index-providers...

I’m genuinely confused how a passive investor winds up tracking the NASDAQ 100 versus a broader index.

Also, if you’re picking and choosing your exposures, you aren’t passive.

Or would you say that e.g. an ETF tracking MSCI ex-US is not a passive fund?

I’d consider someone that puts $50 into Coca Cola stock every paycheck a passive investor

You buy VTI, you're impacted.

I don’t tend to let my emotions out this much here, but utterly fuck everything about this administration, and fuck anyone who voted in favor of it.

Seems like MSCI can add new large constituents very quickly as well [1], so to remain neutral to the frenzy until a price has been discovered, one might need to actively short.

[1] e.g. https://www.msci.com/eqb/methodology/meth_docs/MSCI_GIMIMeth...

No? Contractually, maybe. But legally you can do whatever you want with index constructions.

If they are, you'd only get a license when accepting their terms.

AFAIK the problem is that they're lobbying the nasdaq 100 index provider to add a 5x multiplier for free float for spacex. Otherwise it would be far less controversial.

edit: https://keubiko.substack.com/p/nasdaqs-shame

Spacex will be around 4.5% of the index [2].

If you believe the thesis of the article that Spacex is about 30% overvalued, and if the only advantage your fund manager has over the rest of the market is that they will avoid Spacex, they will save you 1% of your money over the lifetime of your investment. Assuming you're saving for retirement in 30 years time, the fees will cost you 15% or more.

Maybe your fund manager finds a Spacex-level mispricing every two years. In that case, they're worth the fees. Some people will tell you nobody can beat the market. My employer among others believes very strongly in the idea that some people do make better investment decisions than average. What is certainly true is that not everyone does.

[0] https://helpcenter.ark-funds.com/what-is-the-fee-structure-e...

[1] https://www.invesco.com/qqq-etf/en/home.html

[2] https://www.fool.com/investing/2026/04/01/how-the-spacex-cou...

Of course some do. After all, that's what makes an "average".

Some people are taller than average, too!

But assuming it is: How would you even call it, and how would you describe your methodology in the prospectus? "Tech 100 (compare with e.g. NASDAQ)"?

But as you say, going back to the xAI + SpaceX merger, analysts consistently seem to value it as if it is, so I predict the public will too, at IPO time.

I'm not sure that's the case. Every value in this forecast is absurd, I actually think the author is sincere in there feeling that they are being extremely skeptical.

net income probably: $1.5B – $3B

P/E:500-1000

Of course people will trip overthemselves to buy it up.

That's the thing about SpaceX, some businesses are real businesses that can be modeled in normal ways, like the government launch contracts, and to some degree starlink.

Others, like ~all of xAI, and the starship stuff, are being valued completely independent of revenue. I predict the IPO investors will generally follow the analysis consensus today with those eye-popping numbers.

... Why not? Aside from memes, I mean.

The earnings period is 1 year.

It would mean making 100% return on investment each year.

P/E 30 means returns of 3.33%, P/E of 20 means 5%. These are sensible numbers given people have other investment opportunities.

P/E of Tesla being 400 or so means it would take 400 years of its own profits to be able to afford to privatise itself, i.e. returns of 0.25%

This is obviously untrue. Would you sell a box that spits out $1 million dollars a year for 1 million dollars?

Apple has a float of >99%. SpaceX is going to come out with 3-4% float. Since all big serious total market / whatever index funds are float adjusted, this means that SpaceX will be treated more like a company with $45B market cap, not $1.5T or whatever.

If you're buying most index funds, you should literally not care about this.

If you buy VTI, then SpaceX is going to be like what, <0.1% of the fund? That is noise.

> To balance index integrity and investability, Nasdaq proposes a new approach for including and weighting low-float securities (those below 20% free float). Each low-float security’s weight will be adjusted to five times its free float percentage, capped at 100%. Securities with more than 20% free float will continue to be weighted at full, eligible listed market capitalization, while those below 20% free float will be weighted proportionally to preserve investability.

> The rule reportedly includes a 5x float multiplier for low-float stocks, which would require passive vehicles to treat SpaceX as if it had significantly more tradable shares than actually exist, essentially forcing funds to chase the price.

It sounds to me like a way to increase demand for low float stocks by treating the float higher than it actually is. Glad to hear the explanations about this.

Disagree. Buyers of index funds should care about fiduciary and waste. This is what this seems like at this price. Granted, I’d be more concerned if the fund manager was buying it without a requirement to. The issue still remains about why are we paying so much for this stock? Make it make sense?

Right, but the whole point of index funds is that you're letting the market decide what's worth investing/buying (via market cap/free float weightings) and at what price. If you're making calls on what's "waste" or not, then you're no longer a passive investor and you're just picking stocks.

Check out Matt Levine commentary, which goes into more detail (SpaceX Indexing) https://www.bloomberg.com/opinion/newsletters/2026-03-31/are...

Wait for the lock-up terms.

Any mid-sized country would have multiple cellphone and Internet providers with larger customer bases and less upkeep.

The argument that Starship is somehow an experimental/unproven technology that might fail to materialise was absurd but plausible sounding before flight 1, there were many new technologies simultaneously being deployed to a single launch system in one go.

But after 3 tower catches of the booster demonstrating centimetres of guided precision of the entire stack, this is becoming a tired argument.

I know the author is not making that case at all here, but it seems like one the core reasons to undervalue SpaceX is that Starship might not work out, and this all sounds exactly like how reusability might not work out for the Falcon 9 from 10 years ago.

So what is the near-to-medium-term economic prospect of Starship? That's the question. You can't just say "bigger rocket make more money", because there exists a useful upper to the size of payloads that companies actually want to ship to LEO in practice. To use an analogy, we have jumbo jets, but most flights are not on jumbo jets.

This is only true because we are so completely beholden to the tyranny of the rocket equation with the current status quo. With the $/kg (and payload volume) that Starship would unlock, the entire ELO/GEO/Interplanetary/Deep Space market looks very different.

Labs in space. Hotels in space. Weapons in space. Much more interesting satellites in space. More government science missions. Privately funded science/research missions. etc

A huge synthetic telescope in orbit with an aperture the size of the planet?

How many private earth observation satellites?

The market is huge when weight constraints largely go away and $/kg drops so hard.

What does that even mean? Almost every single Falcon 9 customer will prefer launching on Starship if/when it is available, because the cost will be much lower. A very small segment who have payloads that are exactly Falcon 9 sized and want a very particular orbit might still be better served by F9, but maybe not.

Beyond that, much lower cost unlocks previously untenable opportunities that you have not sufficiently imagined, as stated earlier.

Of course it does. With Starship, SpaceX could've charged NASA/ESA more to launch a bigger JWST than the cost to launch with Ariane 5, with huge profit margins.

On top of that, with a much larger fairing, you could almost certainly simplify the telescope and increase capability. A significant part of the JWST's complexity is the unfolding sequence, which could be simplified with a fairing that is more than double (triple? quadruple?) the volume.

Well, they are going to live with multi-customer payloads if Starship can do it for a tenth of the price. There's already a large market for ride-sharing and it's only going to get bigger.

Except that at some point this stops being true. Induced demand is not infinite. There's no telling when we'll reach that point, or indeed if we've already reached it.

My 50% CI on Starship's fair market value at IPO time is $123b - $227b, with a 80% CI even wider, not based on my own modeling, but based on anchoring to analysts that give credible arguments.

I think a lot of it depends on whether they can make the reuse of the second stage work without having to redo stuff constantly like the shuttle. Reusing the booster will obviously save tons of money and make launches cheaper, but they're competing with themselves here. How big is the launch market with cheaper launches? We don't actually know.

The other core value generation product will be financial transactions. It is unproven whether X money will be adopted for friction free transactions across national boundaries and whether the company can compete in the financial services sector.

SpaceX has basically admitted as much by promising Starship 2 & 3 with larger payloads (that Starship 1 was already supposed to deliver).

[1] https://www.americaspace.com/2024/04/20/starship-faces-perfo...

I missed 2 and 3 it seems.

Starship: zero competitors & potentially makes humans inter-planetary.

Seems crazy if investors put more value on Grok.

Humans being interplanetary would be an amazing technical tour de force. But relatively speaking, there isn’t much revenue there.

European settlers being on the north american continent would be an amazing technical tour de force. But relatively speaking, there isn't much revenue there.

The Pilgrims starved their first year.

What is the realistic, non-science fiction appeal of this?

For comparison, it is routine to see sale prices of 3x to 5x revenue for many, many kinds of everyday businesses that have much less potential than Tesla.

There are very, very few businesses whose shares one could have purchased in 2010 that performed better over the subsequent 15 years. That is about as objective as one can get about determining whether or not something was under or over valued (in 2010).

The SpaceX IPO: retail investor notes

https://news.ycombinator.com/item?id=47612775

SpaceX files to go public

https://news.ycombinator.com/item?id=47604155

Source: https://starlink.com/business/aviation ($250->$10k/mo)

https://starlink.com/business/maritime ($250/mo)

https://starlink.com/business/mobility ($65->$540/mo)

I ended up largely deferring to them, e.g. predicting the public will value xAI at $258 billion ($222b - $310b) at time of IPO, even though I've elsewhere been skeptical that xAI should be valued like a frontier AI lab.

It's a keynesian beauty contest