Investors remain focused on SpaceX’s IPO, as it is an unprecedented transaction in terms of both scale and structure. According to experts from international asset managers, its implications for markets, indices, and portfolios extend far beyond the transaction itself.
“A number of large-cap private companies are heading toward the public markets, and their arrival could reshape the equity landscape. SpaceX, Elon Musk’s aerospace, satellite communications, and artificial intelligence (AI) company, is the first. Its target valuation for the IPO is around $1.8 trillion, which could allow it to raise as much as $75 billion in the process,” note Shannon L. Saccocia, Chief Investment Officer of Wealth Management at Neuberger Berman, and Joe Amato, President and Chief Investment Officer of Equities at Neuberger Berman.
This will be a historic transaction, not only because of the company’s size and brand strength, but also because of the enthusiasm it is likely to generate among both institutional and retail investors.
“However, enthusiasm is not an investment discipline. The issue is not simply determining whether SpaceX is a great company, but assessing what expectations are already reflected in its price,” says Aymeric Gastaldi, International Equity Portfolio Manager at Edmond de Rothschild Asset Management.
According to Gastaldi, there is also a structural factor investors should consider: index inclusion.
“If a company like SpaceX were quickly added to the major Nasdaq indices following its IPO, passive funds and ETFs would become forced buyers. This could absorb a significant portion of the available free float and create additional upward pressure on the stock regardless of its valuation,” he explains.
Is There Enough Investor Demand?
Regarding the SpaceX IPO, Adam Berger, Multi-Asset Strategist, and Matthew Strzepka, Head of Equity Capital Markets at Wellington Management, believe the first lesson will be whether sufficient investor demand exists. In their view, the answer is yes.
“SpaceX enjoys enormous brand recognition and is likely to attract interest from a broad range of investors. We also expect retail investor participation to be significant, given the extensive media attention surrounding the offering and reports suggesting that the company may allocate a substantial portion of the shares to this group,” they note.
The Wellington Management experts also point out that inclusion in major indices would mean that many passive investment funds could be compelled to purchase shares within a short period, while active managers would need to consider SpaceX within their benchmark investment universe.
They also note that hedge funds and crossover funds, which can invest in both public and private companies, could further boost demand.
“Pricing and valuation will ultimately play a decisive role, although we expect the IPO to be priced at a level that is attractive to both retail and institutional investors,” they add.
For Clémence Rusek, Chief Investment Strategist at Vontobel, concerns about the market’s ability to absorb such offerings appear justified at first glance.
“The concentration of IPOs and capital increases from large-cap companies over a relatively short period raises fears that the supply of shares could significantly exceed demand,” she says.
However, she acknowledges that the underlying data suggest otherwise.
“The proposed IPO structures are likely to involve only 5% to 6% of total shares being offered initially, meaning the effective supply entering the market at the time of listing could be considerably smaller than overall valuations imply. Therefore, despite the record figures, the total share offering is expected to represent only around 1% of total stock market capitalization, a level that remains below long-term averages when measured relative to the overall size of equity markets,” she explains.
Nevertheless, Berger and Strzepka warn that this does not rule out periods of volatility in the stock, although they expect broader market volatility to remain contained.
“Historically, some large IPOs have created short-term market disruptions, but these movements generally do not have a significant or lasting impact on the market as a whole. While the new wave of large IPOs could exceed previous examples in size, it is worth remembering that total market capitalization is also much larger today than it was in the past: bigger fish, but also a bigger pond.”
SpaceX, One of Many
This leads to a second question raised by international asset managers: are we entering a new wave of IPOs?
According to Rusek, the answer is yes. He argues that a new wave of mega-listings is set to dominate equity markets in 2026, driven largely by artificial intelligence.
“Companies such as OpenAI, SpaceX, and Anthropic are preparing to go public at valuations measured in trillions of dollars, potentially creating one of the largest issuance cycles in market history,” Rusek notes.
History suggests that successful IPOs can create a “halo effect.” A successful offering paves the way for the next one, creating a virtuous cycle. Various reports indicate that several large companies are waiting for the right moment to go public. If the SpaceX IPO proves successful and its performance as a listed company is positive, it would be reasonable to expect other major offerings to follow.
“The rally in equity markets during 2025 and the first half of 2026 has boosted IPO activity, with implications for both private equity and public market investors. Two years ago, prices in public markets were below the levels at which private company owners were willing to sell. Following the strong gains since then—particularly in technology stocks—market prices and seller expectations are now more closely aligned,” explain Berger and Strzepka.
A Radical Shift for Passive Investing
For the experts at Neuberger Berman, it is crucial to analyze the implications of SpaceX and other mega-IPOs for passive indices, considering that approximately $30 trillion in assets globally track such benchmarks.
Index providers are now making active decisions about when to include mega-cap companies, what weightings to assign them, and how to adjust their rules to accommodate the anticipated surge in demand.
“Importantly, at the time of inclusion it is difficult to calculate an exact weighting in the S&P 500. Under current plans, SpaceX would join the index in June of next year, at which point more shares would be outstanding and the index itself would have changed. But based on a current valuation of $1.75 trillion, and assuming 53% of the float is available by June 2027, we estimate SpaceX’s float-adjusted market value at roughly $930 billion. That would translate into approximately a 1.4% weighting relative to the index’s current market capitalization of $65 trillion.
However, the mechanical buying pressure is considerable: our base-case scenario suggests that index funds could absorb 24% of the outstanding shares by day 15. This means passive investors will own SpaceX stock without having made an active decision to buy it,” explain Saccocia and Amato.
Their conclusion is that index inclusion will also require proportional sales of existing holdings to rebalance portfolios, primarily among large-cap constituents of the index and especially technology stocks such as Apple, Microsoft, and Nvidia.
“Another factor to consider is that lock-up expirations begin periodically after the company reports its first earnings and well before its inclusion in the S&P 500. This is likely to add significant supply pressure,” they conclude.
