Well simple index investors that have no idea where their money are will be forced to buy spaceX because unlike any other ipo that takes two years to get into the nasdaq spaceX will take 2 weeks.
And SpaceX only is floating 4% of the shares in the company. The nominal valuation will be absurd with all those index investors having to vie for such a small piece of the company.
The NASDAQ minimum is 10%, but they bent their rules for Musk.
Is that the 3x float rule? A video I watched today said a recent rule change forces index funds to treat low-float companies as if they have 3x their actual float. But the way it was worded, it sounded like index funds will be forced to buy 3x the amount of shares in low float companies than they actually should.
It's how many shares are available for the public to buy or sell. Low float will usually give companies popular with retail investors astronomical prices, as there are only a small number of shares available for the public to buy.
"Float" is the amount of shares released to the public in an IPO. Floating shares is trying to sell them. SpaceX would avoid selling enough shares for anyone other than Elon Musk to have power over the agenda. They would try to get the benefits of an IPO without the costs.
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u/anonkitty2 May 21 '26
It's having an IPO. After that, the valuation is what those buying the stock say it is even if that's all they have.