401(k) Plans Gain SpaceX Exposure After $150 IPO, Parallels Robinhood’s 74% Drop
HOOD•Nasdaq-100 and Russell 1000 rule changes have enabled SpaceX to join benchmarks days after its June 12 IPO at $150, giving 401(k) funds immediate exposure to the stock’s swings. Prior mega-IPOs saw sharp declines, notably Robinhood’s 74% slide in its first year and Coinbase’s 55% drop.
1. Index Funds Add SpaceX After IPO
Nasdaq-100 and Russell 1000 altered criteria to admit unprofitable mega-IPOs, enabling SpaceX to enter flagship indexes days after its June 12 $150 debut. This change means 401(k) plans holding index or total-market funds now contain SpaceX shares.
2. Post-IPO Volatility Mirrors Past Declines
SpaceX stock surged above its IPO price before falling back to near its initial levels, mirroring past high-profile offerings. Robinhood shares tumbled 74% in their first year and Coinbase lost 55%, illustrating potential swings.
3. Managing Volatility in Retirement Portfolios
Despite inclusion, SpaceX weighting in broad-market funds remains low and its short-term impact on diversified 401(k) portfolios is limited. Investors can adjust allocations or select bond and sector funds to curb unwanted exposure.
