Investors can own SpaceX without waiting for an IPO by purchasing shares in mutual funds and ETFs that hold SpaceX stock. Revolutionary stuff. Truly groundbreaking financial innovation. Next you'll tell me I can eat a hamburger by ordering a combo meal.
The headline promises access to SpaceX stock without buying the IPO. Except SpaceX hasn't had an IPO. That's the whole f*cking point. It's a private company. Saying you can avoid buying the IPO is like saying you can avoid getting struck by lightning from the moon. Technically true. Completely useless information.
Here's what's actually happening. Some mutual funds bought SpaceX shares in private funding rounds. You buy the fund. Now you own 0.003% of a fund that owns 0.8% of SpaceX, which owns rockets. Congratulations. You're basically Elon Musk. Minus the money, the equity, the control, the liquidity, and the ability to sell your position without liquidating your entire retirement account.
Retail traders will read this headline and think they've discovered a secret backdoor into SpaceX. They'll dump their savings into some bloated tech fund with 147 holdings just to get exposure to one private company they can't value, can't research, and can't exit independently. The fund manager charges 1.2% annually for this privilege. SpaceX might go public in five years. It might not. The fund will definitely collect fees either way.
But sure, this counts as "holding SpaceX stock." In the same way that owning a timeshare in Orlando counts as living in Florida.
The best part is calling this strategy an alternative to buying the IPO, as if retail investors were ever going to get IPO allocation anyway. Goldman Sachs wasn't saving you a seat at that table. You were never invited. Now you're paying expense ratios to crash a party that hasn't even been scheduled yet.
Photo by Sven Piper on Unsplash
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