SpaceX Is About to Be in Your Portfolio — Whether You Love or Hate Elon Musk

Following months of speculation, Elon Musk's SpaceX is slated to hold its initial public offering, or IPO, on June 12. And while the aerospace tech, AI and space transportation company's long-awaited public debut is attracting considerable attention, not all of it is positive.

Musk is controversial, to say the least: According to the Pew Research Center, 54% of Americans view the SpaceX founder and CEO unfavorably. Other complicating factors include its problematic finances, concerns about the stock's potential performance and questionable decisions that will allow SpaceX to bypass rules and be included in the major indices sooner than was previously allowed.

But the majority of everyday investors actually won't have a choice about whether or not they own SpaceX. Here's why.

Wall Street bends the rules to accommodate SpaceX's IPO

For most investors, owning shares of broad, passively managed index funds like the Vanguard S&P 500 ETF (VOO) is the most seamless and likely path to growing wealth over time. The major indices — performance benchmarks that tracks specific groups of stocks — act as gatekeepers, ensuring only the highest-quality companies are eligible for inclusion.

But with the increasing number of trillion-dollar tech firms and a pipeline of AI IPOs, Wall Street is adapting its rules ahead of SpaceX's debut. This could lead to the company being fast-tracked into the Nasdaq-100, the S&P 500 and the passively managed exchange-traded funds (ETFs) that mirror those indices' holdings.

In order to join the S&P 500 — the bellwether of the 500 largest companies in the U.S. stock market — a company must usually meet strict criteria, including having at least 250,000 shares traded in each of the previous six months, demonstrating positive earnings over the past four quarters and being at least one year removed from its IPO.

For the Nasdaq-100, an index of the 100 largest non-financial companies listed on the Nasdaq stock exchange, the "seasoning period" required for listing is normally three to 12 months. A company must also have a float — the proportion of its shares available for public trading — of at least 10% of its total shares issued.

Those parameters have historically served as a quality control measure for the benchmarks. For instance, Tesla — another Musk-led firm — wasn't added to the S&P 500 until more than 10 years after its IPO in June 2010, despite it growing to one of the world's largest companies.

The S&P 500 seriously considered lowering its seasoning period from one year to six months while exempting mega-cap companies like SpaceX from its financial profitability requirement, but it announced Thursday it's not changing the rules.

The Nasdaq-100 has already taken action to accommodate SpaceX's listing. The stock could be added to the index as soon as July 7 — just 15 trading days after its anticipated IPO — thanks to a "fast entry" rule. The rule permits companies within the top 40 by market cap to benefit from expedited inclusion and removes the 10% free float requirement.

When it IPOs, SpaceX is expected to have a float between 3% and 5% of its total shares, markedly lower than the average of 75% to 90% for mega-cap companies. Meanwhile, the company is not operating at a profit. According to its Form S-1 filing with the U.S. Securities and Exchange Commission, the firm posted a net income loss of $4.9 billion in 2025.

In the first quarter of 2026, SpaceX's losses accelerated to $4.3 billion for the three months ending March 31, compared to revenue of $4.7 billion.

SpaceX is coming to your 401(k) within weeks

Index funds that track large- and mega-cap equities have become the go-to for passive investors who use ETFs like the aforementioned VOO or the Invesco Nasdaq 100 ETF (QQQM), as well as retirement savers using target-date funds in 401(k)s. When SpaceX joins those indices, fund managers will be obligated to buy billions of dollars of its shares.

"It used to be an IPO had to be listed for a year to be included in an index," says Neil McDonald, U.S. CEO at Moomoo, a trading platform. "Nasdaq kind of fudged it by changing the rules. They say 15 days. So what that means is if you own... the Nasdaq ETF, within 15 days, I think SpaceX will be the seventh-largest component."

That forced buying will likely create a short-term, post-IPO floor for SpaceX's stock price, according to McDonald. It also means decreased risk for investors who don't want to own the stock directly.

"People can get exposure without having exposure to a singular stock," he says. "It's going to be a less volatile way of having exposure to something like SpaceX."

Mandatory institutional buying will come at a cost. In order to free up the cash required to buy shares of SPCX, fund managers will be forced to sell small amounts of the other companies in those respective indices, thereby reducing other their weightings and overall impact on the index.

Another factor that will likely contribute to a price floor for SpaceX is the decision by the company to earmark 30% of its float for retail investors. Accurately assessing the company's valuation will be difficult since it's currently operating at a loss. But at 30% of the float, retail demand for SpaceX is expected to exceed $22.5 billion worth of shares — an unprecedented amount for U.S. IPOs.

Much of that has to do with everyday investors' enthusiasm about the forward-looking visions of Musk-helmed companies... and far less about their fundamentals. That notion was on display in the company's S-1 filing: SpaceX listed future market opportunities, including space tourism, in-orbit manufacturing, energy production on the moon and Mars, and even asteroid mining.

"We believe we have identified the largest actionable total addressable market in human history," the company wrote in its filing.

June 12 will be the first test of that claim.

Julia Glum contributed reporting to this story. This story has been updated to include information about the S&P 500's decision not to change its seasoning period.