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S&P 500 rejects SpaceX, also blocking entry for OpenAI and Anthropic

arstechnica.com

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Re: S&P 500 rejects SpaceX, also blocking entry for OpenAI and Anthropic

#391

Post by xhkkffbf »

KPGv2 wrote: post #277
throw7 wrote: post #247

Earlier quoted context omitted.

I've always favoured Tessier-Ashpool S.A. as comparable. The creation of AI's and Freeside and Musk's pronatalism slots in nicely.

Musk isn't a natalist. The global population is going up. And yet, he complains about not enough births. Because he is a white supremacist. He wants white people to outnumber other races. The current state of affairs would be satisfactory to him if he were merely a natalist.

The population is very hard to count, believe it or not. In many places, the birth rate is well under replacement and in the others it's dropping quickly. Furthermore there's widespread fraud and deliberate miscounting which also makes it hard to really know.

Re: S&P 500 rejects SpaceX, also blocking entry for OpenAI and Anthropic

#392

Post by linuxhansl »

Thank god some sanity prevails.

Adding these to the index immediately would force passive index funds (multiple trillions of $) to buy this stock, and thus not allow the market to make performance based decisions.

It's truly a shame that the NASDAQ caved and I will definitely reduce my position in such index funds (I have less trust in it now).

Re: S&P 500 rejects SpaceX, also blocking entry for OpenAI and Anthropic

#393

Post by BeetleB »

anonu wrote: post #272
zhivota wrote: post #30

Big relief for me. As a passive investor, I want the indices to follow the same passive strategy they always have, and specifically not make exceptions for specific companies like SpaceX wanted. Plenty of ways to get exposure to that stock without it going into the indices it is not qualified for.

You'll eventually get exposure to it when it gets added in 12 months. Unless there are better profitability criteria. Ultimately it's all about market returns. If other indexes add it and outperform then eventually money will shift to those funds that do better.

> Ultimately it's all about market returns. If other indexes add it and outperform then eventually money will shift to those funds that do better.

That's like saying that if Nvidia performs way better than an index fund, then the index fund will shift to consist only of Nvidia.

In any given year, there are plenty of index funds that outperform the S&P 500. They don't freak out over it.

S&P 500 is volatile over 5 years - I'd argue even over 10 years (see the charts at https://blog.nawaz.org/posts/2015/Dec/pay-down-mortgage-or-i...). The whole point of investing in it is for much longer windows.

So yeah, perhaps after 10 years they'll change once they'll see other index funds doing better, and have data to back up that in the long term, early inclusion didn't hurt.

Re: S&P 500 rejects SpaceX, also blocking entry for OpenAI and Anthropic

#394

Post by MyHonestOpinon »

lokar wrote: post #326
dijit wrote: post #321

Earlier quoted context omitted.

if you can't maintain success for 4 quarters then you weren't really successful.

And even if it's not in the S&P, you can still just buy the stock.

Exactly. With the standard rules, it is easy to buy the stock to opt in. If they change the rules, it is very hard to opt out if your portfolio follows the S&P500, like many passive investors do.

Re: S&P 500 rejects SpaceX, also blocking entry for OpenAI and Anthropic

#395

Post by groundzeros2015 »

psychoslave wrote: post #383
groundzeros2015 wrote: post #328

Earlier quoted context omitted.

I think making money usually helps people. But it does affect every decision you make. When you’re investing you look at financial criteria. When you’re donating you look at social criteria. The whole “VC in non-profit” thing was a trend from 2012 to 2017 or so and it did not work out for this reason.

How do you distinguish social from financial here? Isn't finance just a loose way to quantify social considerations?

I think there are plenty of interesting non-profits that won’t make you any money. I donate to some!

There is a radical version of capitalism where you would say only things that make money (what people pay for) are providing social value, but I don’t think that’s what you’re getting at.

Re: S&P 500 rejects SpaceX, also blocking entry for OpenAI and Anthropic

#396

Post by groundzeros2015 »

abustamam wrote: post #375
groundzeros2015 wrote: post #297

Earlier quoted context omitted.

It’s because you just lived through a 10 year period of the best growth for passive, and there is a tremendous amount of marketing online for passive. I don’t disagree with your basic idea, but not being able to articulate alternatives so that you know when they make sense is going to hurt you. We are possibly seeing a major failure mode for passive for the first time.

That's true, but what are the alternatives? Personally I do have alternative investments (crypto, random held stocks) but it's because it's fun money - if it goes to zero, I'm not going to lose the house. If it's the first time it's failing then there's really nothing anyone can do to prepare for it, and I certainly wouldn't recommend laypeople to try to time the market.

Alternatives include - paying a mutual fund manager (who will skip the SpaceX ipo) - other assets classes like real estate and bonds - less diversified stock holdings

In this story we determined that S&P is going to choose a path different that other ETFs. Does that mean these ETFs differ in quality? Which should you pick?

Re: S&P 500 rejects SpaceX, also blocking entry for OpenAI and Anthropic

#397

Post by carlosjobim »

abustamam wrote: post #263
danielovichdk wrote: post #16

Stocks and money. It's so boring. I will go drive my old German car now, and get a bit drunk in a bottle of Nebbiolo while listening to some French lunatic with a piano. Enjoy your trip to Mars and your self driving toy cars. The world is off its rails. Bit time.

Stocks and money should be boring for most people. I'm not a financial adviser and this isn't financial advice but I believe no one with a net worth less than $2m should ever buy an individual stock. Invest in a target date retirement fund for your 401k. Same for Roth Ira. If you have more money to invest after that, invest in an index that aligns with you values (for example I invest in an ESG index for environmenta…

On the contrary: People with a low net worth have very few opportunities to scratch and claw their way out of their holes in this global feudal system. They are the ones who need to be able to make high-risk, high-reward investments.

A conservative 10% return on a 2 million dollar investment is a very nice 200 000. A conservative 10% return on a 20 000 dollar investment is just 2000.

If you're not born rich in this world, there are but a few doors that are open to you to try to improve your station in life. Hard work will never help you out of the hole. Not even dangerous work. Nor will an education. At least with high risk investment you have a fair chance, and at worst you loose your savings and are back where you started. You're not going to lose your life or your limbs.

Re: S&P 500 rejects SpaceX, also blocking entry for OpenAI and Anthropic

#398

Post by groundzeros2015 »

CuriouslyC wrote: post #376
groundzeros2015 wrote: post #359

Earlier quoted context omitted.

> there's a fiscal hole that has to come from somewhere. Why? If new technology is invented that enables us to do new things with fewer resources doesn’t that create wealth? It didn’t take it, it made a new thing.

You should do the math on how much AI would have to create in order to fill the hole. Spoiler: we'd need nearly the best case scenarios for AI driven global GDP growth predicted by the most bullish firms, we'd need to regress to pre-Reagan corporate tax rates AND the AI companies would need to suddenly grow a conscious and stop their tax avoiding ways.

I still don’t know what “hole” Mean in this context.

My previous attempt was to consider it as a cost for AI companies to exist?

Re: S&P 500 rejects SpaceX, also blocking entry for OpenAI and Anthropic

#399

Post by dehrmann »

codegeek wrote: post #298
zhivota wrote: post #30

Big relief for me. As a passive investor, I want the indices to follow the same passive strategy they always have, and specifically not make exceptions for specific companies like SpaceX wanted. Plenty of ways to get exposure to that stock without it going into the indices it is not qualified for.

Agreed. S&P 500 needs to be seriously gatekeeped. We need safer boring companies in there thatbhave been peoven over a long period of time. Nothing against these companies but they are not proven and ready for S&P 500.

What you're describing is closer to the DJIA.

Re: S&P 500 rejects SpaceX, also blocking entry for OpenAI and Anthropic

#400

Post by r-w »

Groxx wrote: post #378
ls612 wrote: post #372

Earlier quoted context omitted.

How is this any different than Microsoft? I suspect all of the big four use AD and Windows in their enterprise yet that isn’t a dealbreaker for auditing MS’ financials.

Are you honestly trying to imply that Excel is as easy to invisibly manipulate as ChatGPT?

Who said anything about it needing to be invisible?
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