| > I think the hate about this idea is unwarranted. I doubt the hate is about passive investment funds owning SpaceX stock. If the rules weren't changed and the index funds ended up owning a lot of SpaceX anyway, no one would care. The hate is because the index funds used those indexes because they avoided including partial IPOs like this, I guess because they could be prone to manipulation. The funds apparently never imagined the rules controlling how the indexes would be changed. The rage was triggered because not only were they changed, but how the change came about. To wit: - NASDAQ owns both an index and an exchange. - SpaceX said "we will list on your exchange, if you change the rules of the index". - The rule change they wanted looks allow the very manipulation the index funds were trying to avoid. The indexes aren't meant to be speculative, they are a way to follow the average of blue chip stocks. - This is speculative, but it looks like SpaceX is hoping to manipulate the index funds into purchasing large quantities of their stock, in order to give the early investors a plump exit. If true, the stock would then crash, leaving the index funds holding the bag. - The NASDAQ allowed themselves to be bribed. It's possible of course the IPO won't go as planned, or the market will look at the 54 P/E and run away screaming in that initial 15 days, causing the price will plummet. Or it's possible the early investors will throw money at the stock until the 15 days it up to sustain the price. Who knows. Interesting times. |