SpaceX Joins Index as IPOs Slide 55% to 74%, Including Rivian
RIVN•Truist CIO studied 30 recent IPOs and found Rivian among four major offerings that plunged as much as 74% in their first year, illustrating post-IPO volatility. New rules now permit unprofitable mega IPOs like SpaceX to join major indexes days after debut, exposing 401(k) investments to heightened swings.
1. IPO Volatility Trends
A recent review of 30 major IPOs highlights the steep share declines that often follow public debuts, with drops ranging from 55% in Coinbase to 74% in Robinhood and significant slides among Lyft, Rivian and other high-profile listings.
2. Expanded Index Inclusion Rules
Regulatory adjustments have removed profitability barriers, allowing unprofitable mega IPOs like SpaceX to be added to the Nasdaq 100 and Russell 1000 within days of trading, rather than waiting for a full performance record.
3. 401(k) Exposure and Management
Broad-market index and total market funds tracking those benchmarks have begun allocating small positions to SpaceX in employer-sponsored retirement plans; investors concerned about volatility can rebalance allocations or select strategies that limit index concentration.
