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Can the stockmarket swallow Anthropic, SpaceX and OpenAI?

economist.com

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Re: Can the stockmarket swallow Anthropic, SpaceX and OpenAI?

#691

Post by deflator »

freetime2 wrote: post #282
augstein wrote: post #105

For SpaceX (and possible the others): Yes it can, since they changed the rules to force over $30 trillion in passive 401k and retirement money to buy SpaceX at IPO valuations. From https://x.com/Hedgeye/status/2060435253928604065 : "Rule changes for the SpaceX $SPCX IPO: Index providers waived the profitability requirement and cut the seasoning window from 90 days to 5. This forces over $30 trillion in passive 401k a…

I don't like this either, but from the article: > Although Nasdaq has already shortened the “seasoning” period before index inclusion to 15 trading days and FTSE Russell has slashed its waiting time to five days (and S&P Dow Jones is reportedly considering something similar), most share indices weight firms in proportion to the value only of shares they have released for public trading (the “free float”). For SpaceX,…

This really makes it clear. Thank you!

Re: Can the stockmarket swallow Anthropic, SpaceX and OpenAI?

#692

Post by me551ah »

None of these companies have any MOAT.

LLMs are getting better at a rapid pace and in a year or two, Chinese LLMs should easily catch up with the best of the models. Models have kind of reached a saturation point and that’s why OpenAI and Anthropic are doing an IPO now. Because a year down the line when their lead diminishes even more, they would be worth lesser money.

SpaceX has clients to put payloads into space, but those clients have always looked for good low cost alternatives. It is going to have competition in the future and will lose customers.

Re: Can the stockmarket swallow Anthropic, SpaceX and OpenAI?

#694

Post by baggachipz »

DanielHB wrote: post #684
iLoveOncall wrote: post #481

Earlier quoted context omitted.

No, it's wrong. Amazon is worth $2.81T right now and only represents 4.03% of the S&P500. So a $1T share would represent less than 2% of the S&P500. This is significant for a single company, and 6% for 3 shit-tier companies (SpaceX, OpenAI and Anthropic) is even more significant, but we're far from "losing retirement if they go bust"-levels.

If they go bust won't it likely trigger a massive market crash? Afterall index funds will be forced to sell other US stocks to buy them, bringing their values down. Non-passive investors will predict that and divest even more and so on... And that is on top of the IPO companies losing value themselves, this seems likely to trigger a doom-loop until the market reaches a low enough value. This will likely trigger layof…

Yeah, think dot-com crash all over again, but probably worse IMO. Problem is, there really isn't a safe place to hide when this all happens. Some are less unsafe, like funds which track dividend-yielding stocks, or gold I guess (but that's just a speculative value store like bitcoin).

Re: Can the stockmarket swallow Anthropic, SpaceX and OpenAI?

#695

Post by wucke13 »

bluecalm wrote: post #586
matwood wrote: post #504

Earlier quoted context omitted.

You shouldn't be downvoted because your point is completely valid. Matt Levine made the same point in the last Money Stuff podcast. These indexes are supposed to contain the largest, most significant, and in some cases all companies so people shouldn't be mad at the indexes for pulling in a company that's going to have a 1.5T market cap at IPO. Given the market cap, it would actually be weird to not have it in an ind…

>>If people really don't want SpaceX in their S&P 500 tracking ETF, we should see a S&P-ex SpaceX in short order. "People" don't know much about finance to put it mildly. ETFs are created by market demand. Even "factors" ETFs are often based on completely irrational things like dividends, P/E ratios and other meaningless metrics. This happens because people are easily seduced by narratives ("solid dividend paying sto…

> I pay 0% capital gain tax and use a broker with nearly 0 fees which allows me to rotate for free (almost)

How so?

Re: Can the stockmarket swallow Anthropic, SpaceX and OpenAI?

#697

Post by bluGill »

DanielHB wrote: post #679
rybosworld wrote: post #648

Earlier quoted context omitted.

Definitely not. What Spacex/Elon are doing is sketchy as hell. But the numbers involved here are not terribly meaningful for your portfolio. At IPO, $75B of Spacex shares will be bought/sold. The S&P 500 uses float-adjusted weightings, and the current float-adjusted total is $54T. If you are 100% invested in SPY, then about 0.14% of your holdings will be spacex on IPO day (75B/54T~=0.14%). Obviously Musk and friends…

I dunno won't index funds be forced to sell other stocks to buy these IPOs? Won't that possibly trigger a market crash if the IPO stocks loses a lot of value very fast after the IPO on top of investors predicting this fact and selling shares of other companies? I dunno, the logical explanation makes sense, but markets don't work on logic especially on the short term. People fearing what other people will do and act i…

Read the find print, but probably not. Index funds are aware of the issue you raise and they all have plans to handle it. Plans range from "not a problem, ignore", to "we don't even try to have the same stocks as the index, just similar stocks that we think will match the index performance". Most are someplace in between those extremes.

Re: Can the stockmarket swallow Anthropic, SpaceX and OpenAI?

#698

Post by bluGill »

kys11 wrote: post #663
ejoso wrote: post #634

Earlier quoted context omitted.

This should trigger all of us to be spinning up lawsuits. This whole thing is an absurd grift.

[dead]

class action is the average person's best bet here. You should expect to get $.75 while the lawyers make big money.

Re: Can the stockmarket swallow Anthropic, SpaceX and OpenAI?

#699

Post by nonethewiser »

augstein wrote: post #105

For SpaceX (and possible the others): Yes it can, since they changed the rules to force over $30 trillion in passive 401k and retirement money to buy SpaceX at IPO valuations. From https://x.com/Hedgeye/status/2060435253928604065 : "Rule changes for the SpaceX $SPCX IPO: Index providers waived the profitability requirement and cut the seasoning window from 90 days to 5. This forces over $30 trillion in passive 401k a…

>Yes it can, since they changed the rules to force over $30 trillion in passive 401k and retirement money to buy SpaceX at IPO valuations.

Why not just say SpaceX is being added to the SP500?

You can complain about the discretion to add it to the SP500. But that's irrelevant in terms of whether or not its "forcing" people to invest in it. Arent you upset people are forced to invest in Apple, Bank of America, etc.?

Re: Can the stockmarket swallow Anthropic, SpaceX and OpenAI?

#700

Post by rapind »

bwb wrote: post #629
derf_ wrote: post #525

Earlier quoted context omitted.

As of January, TSLA was somewhere around 2.3% of the S&P [1]. Because SpaceX will have so little float available, it would be somewhere around 0.7% if included. [1] https://en.wikipedia.org/wiki/S%26P_500

Ya, but this is a proof-of-concept rip-off. The fact that the indexes don't have our back is a huge problem.

It's only a problem for the ones left holding the bag. I'm at an all-time low allocation percentage in the US stock market and considering pulling more out still. Full on casino vibes at this point.
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