New Nasdaq rules open door for SpaceX, other tech giants to join "passive" index funds immediately after IPO

A new methodology from Nasdaq went into effect on Friday which will speed up the entry of market listings, just in time for some of the biggest IPOs that the market has ever seen.

Later this year, SpaceX, Anthropic, OpenAI, and other firms are expected to test the market. They will be among the biggest firms to ever test the public markets. Latent demand for these listings are already apparent, as a whole class of private investment-focused "closed-end funds" have rushed to market in recent months, hoping to capitalize on their small allocations in these up-and-comers.

However, there are plenty of reasons to have reservations: Whether it's SpaceX's record asking valuation of $1.75 trillion, OpenAI's increasingly precarious financial situation, or Anthropic burning its goodwill after undeclared changes to its billing practices and model access. But perhaps the most concerning undertone is that you might be buying these firms anyways, whether you like it or not.

Buying at all-time highs

A few months back, as Nasdaq was competing with the New York Stock Exchange (NYSE) for the SpaceX IPO, it was reportedly said that the company would demand inclusion in its indexes immediately after its listing.

Historically, it has been that you must wait at least a year to be eligible to join the index and make a certain percentage of the company available to the public. However, in an effort to win over Musk (and hopefully, other tech IPOs to come), the company made the rule changes.

Hypothetically, let's pretend for a second that these rules were in place and were compelling enough to convince some recent IPOs to list on the Nasdaq, and thus be added to its indexes immediately:

• NYSE-listed Figma is down 84% since its listing, so that would have been a mistake.
• Nasdaq-listed CoreWeave is up 198% since its listing, but wasn't eligible to join the index immediately.
• NYSE-listed Circle is down 8% since its listing, so they dodged a bullet here too.

Yes, I understand that SpaceX is nothing like the aforementioned. The above firms are like stars and SpaceX is like a supermassive black hole. But the aforementioned offer a glimpse of the various ways recent tech IPOs have gone; they have been terrible, so-so, and great.

This is important to remember because SpaceX, OpenAI, and Anthropic are going to command trillion-dollar valuations when they list. We only know that SpaceX is coming to Nasdaq, but assuming OpenAI and Anthropic were to follow suit, the three would be among the largest firms in the Nasdaq ETFs; a $3 trillion tsunami which will affect the ranks at the top of the indexes.

After just 15 days, these firms will be added to the ETFs. Their fates will also play an outsized role in whether your investment portfolio sinks or swims. That, frankly, doesn't feel like investing. That feels like gambling.

Everybody wins? That depends

I understand that there is a lot of excitement around these IPOs and their valuations. I have, however, stressed that price discovery in these firms have gone one way in the private market: Like a rocket ship, they've only gone up.

That won't be a given on the public market, but that doesn't really matter. At the end of the day, three groups of people will win: the listing company, its investors, and Nasdaq.

Companies listing on the Nasdaq won't just get the billions in proceeds from their IPO, but a guaranteed bid from Invesco's QQQ and QQQM products, which own "roughly 1.4% of constituent companies' total market caps" according to Financial Times.

The private investors and venture capitalists also score, since they're not just getting a windfall from the listing, but guaranteed buyers. If that doesn't say "exit liquidity", I don't know what does.

Then, of course, there's Nasdaq. They scored the listing, get the trading fees, and don't have to spend any money. They just add the stocks to the index after 15 days and Invesco has to spend billions to buy the stock, supposedly for your benefit. (Debatable.)

Dump to avoid the dump?

But what about the passive investor? Well, that's up to the whims of price discovery. Yes, it could work out somehow, but it's important to remember that most IPOs lose money. I know that these companies are not "most IPOs." They have fanfare and demand.

I've gotten into the weeds on the thorny valuation problem, plus the commodification of AI models (which even SpaceX is touting as a significant part of its business), in the past. There are plenty of worries about the businesses as they remain unprofitable and might not turn a profit for several years (you can hope this is Uber on steroids).

However, there's also a swath of data that supports that fast-track inclusion of equities is generally not a winning strategy. There's also the warnings from money guys like one-time Tesla defender Ross Gerber of Gerber Kawasaki Wealth and Michael Burry of "The Big Short" fame have both warned about this in recent days, lamenting Nasdaq's decision to fast-track these investments, alleging that it facilitates insider selling.

Therein lies the foreboding. Evidently, Nasdaq sold out passive investors by guaranteeing inclusion to SpaceX, clearing the way for more tech giants to do the same. Investors in the Nasdaq funds will end up becoming forced buyers of these assets at the highest valuations that the public markets have ever seen. It'll be like a lottery ticket.

How to respond

So what do you do? Well, if you're happy with that, nothing. But if you're worried about the most expensive IPO in history being airdropped into your portfolio just days after its listing, you might consider swapping out your Nasdaq funds for an equivalent fund.

A pivot like that could be as simple as going from the tech and consumer-focused Nasdaq-100 to an S&P 500 fund, which would offer less tech concentration and greater diversification.

However, tech purists might prefer the iShares S&P 500 Growth ETF, which holds many of the same assets as the Nasdaq-100, albeit at a lower fee. A tech-specific ETF like the VanEck Semiconductor ETF ($SMH) or Technology Select SPDR Fund ($XLK) might also make up for the absence of the Nasdaq-focused funds in your portfolio.

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This story was originally published May 1, 2026 at 4:14 PM.