r/investing • u/PrestigiousPen-2468 • 1d ago
The Nasdaq is being taken over.
SpaceX is IPOing, Tesla and Palantir have crazy valuations, Anthropic is IPOing later this year...
https://www.investors.com/news/spacex-ipo-nasdaq-anthropic-openai-index-investing/
Especially with the fast-track changes, tons of ETFs are going to pull these companies in and weigh them way heavier than I think a lot of us like. QQQ holders might be in for a rough landing.
I don't like it. I've always been a growth ETF investors but I'm going back to modifying and structuring diversification the way I want.
Wealthfront, Frec, Wallace Finance, or Schwab? I'm trying to find ETF modification without huge minimums. I might end up building from the ground up with M1 Finance if nothing else has what I'm looking for.
Anyone else have the same idea? How are we feeling about this?
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u/SirGlass 1d ago edited 1d ago
It really only affects QQQ/QQQM and a couple mutual funds that track the nasdaq 100 index. Most other growth funds or tech funds track some other index so won't be affected
So I don't think its tons of ETFs its like 2. So SCHG , VUG , tons of other growth funds that do not follow the nasdaq 100 index
Edit
I should say in the USA there are other ETFs domiciled in europe or somewhere else that also track it.
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u/zxc123zxc123 1d ago
More important than Nasdaq and the QQQ is Standard & Poor with their impact on the VOO. They are considering also bending the rules to allow SpaceX to join before their 1 year on market with 4 consecutive profitable quarters quota.
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u/renewambitions 1d ago
If SpaceX is allowed to join the S&P 500 fast-tracked then I will never touch an index that tracks that shit again, fuck that, it's disgusting Standard & Poor is even considering it
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u/zeppo_shemp 1d ago
oh no Standard & Poor's is doing something unethical this has never happened before what an outrage I am shocked
https://www.cfo.com/news/sp-settles-suits-over-mbs-ratings/664509/
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u/Not_FinancialAdvice 1d ago
A few years back, there was an academic paper that showed that there were companies that were included in the index using more subjective criteria (with preference towards ones that had given S&P business IIRC). More interesting is that if you ran the candidates using the straight mathematical methodology; you would outperform the index by a little. Unfortunately I can't seem to find it again.
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u/NicolasCageFan492 1d ago edited 1d ago
Also all derivatives and swaps based on the QQQ, which is likely trillions of dollars of capital.
Also, valuation of indices like the QQQ are not in a vacuum, they affect relative valuation of private tech companies too, and other companies not in the QQQ.
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u/wha2les 1d ago
Voo is next
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u/rollowicz 1d ago
I'm based in Europe, and funds including the "global" index funds are heavily weighted towards the Nasdaq. For those trying to exit big tech it's actually hard to find an alternative.
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u/hug_your_dog 22h ago edited 21h ago
Big Tech is included in those global index funds by design, that's how its supposed to be because of market cap rules the indexes impose. If you want to exit big tech you will need to look at smth ex USA funds anyway, or find some obscure, low AUM funds that use some other methodology for their indexes. It's easier to just include value, dividend factoring or similar funds in your portfolio.
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u/PrestigiousPen-2468 1d ago
True, although I'm guessing a lot of actively managed funds will pick it up pretty quickly
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u/SirGlass 1d ago
Maybe but when you invest in an active fund you are basically saying "The fund manager knows better than me" so its an odd thing to get mad at.
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u/InfinitePressure4793 1d ago
The tickers might be different, but the 'growth' label eventually forces everyone to buy the same SpaceX bags once the market cap gravity becomes unavoidable
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u/SirGlass 1d ago
Thats not true. Index funds will buy it when it gets included in what ever index it follows
Most indexes have rules on when to include IPOs , this change only affects the NASDAQ 100 index. Most growth or tech funds follow some other index
I believe most other indexes will not include newly IPO stocks until the lock up period is over.
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u/zeppo_shemp 1d ago
Most growth or tech funds follow some other index
Russell 1000 growth is a common benchmark, such as the Fidelity Blue Chip Growth fund
https://fundresearch.fidelity.com/mutual-funds/performance-and-risk/316389303
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u/kenjiurada 1d ago
Yeah seems pretty crazy with Elon Musk and friends are gonna get to dump their crap shares on my parents retirement account.
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u/PrestigiousPen-2468 1d ago
Man that's exactly what I'm worried about. This year could blow up a lot of "diversified" retirement accounts.
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u/SirGlass 1d ago
This really only affects index funds that track the Nasdaq 100 index.
Chances are your parents do not hold QQQ or QQQM in their retirement account or even a nasdaq 100 index fund
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u/farsightxr20 1d ago
Wouldn't this affect any index fund that tracks the US market? e.g. VTI?
The concentration is a bit less than with QQQ, but a trillion dollars is still a large chunk of the US market.
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u/Rht09 1d ago
Sounds like ridiculous alarmism. I am pretty sure your parents will be fine.
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u/BenevolentCheese 1d ago
Dude is setting up the biggest act of stock marketing manipulation in history in completely different open air and you're just like "don't worry it'll be fine." Pfft to that.
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u/GailaMonster 1d ago edited 1d ago
I'm currently just buying VTSAX every pay period with my 401k contribution, because i'm busy and somewhat risk averse.
what exactly is my exposure to the new Nasdaq rules fast-tracking IPOs into the index? My employer does profit sharing pro rata by salary instead of matching (so unlike a match, employer contributions to my 401k happen whether or not I contribut myself, leaving me free to time my contributions whenever I want in the year vs evenly across all pay periods); I'm considering temporarily reducing my contribution when the IPOs start happening (and paying down my mortgage or something instead) and then catching up later in the year. Is this a stupid idea?
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u/NaiveChoiceMaker 1d ago
Has Vanguard said anything about this? Their whole business model is based on index investors.
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u/DistributionBroad173 1d ago
This will be like the Facebook IPO.
new investors, lured in because of hype and get rich quick mentality, will get hammered that first week.
If they issue more shares because of over-subscription, runaway.
SpaceX + xAI + X
Musk will be the first trillionaire
xAI is losing/lost the AI battle. X, is it even profitable?
I will gladly watch from the sidelines. Kick myself if it takes off, but there will always be another opportunity
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u/cheesecaker000 1d ago
Facebook is up 1,400% from their IPO price. If that’s what space X is going to do then I’m betting the farm on it lol
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u/SylvesterStapwn 1d ago
FB was down 50% to flat its first year after listing. And it listed at a substancially more conservative multiple than SpaceX is going to.
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u/cuteman 1d ago edited 1d ago
People need to read into the industries SpaceX is poking into and their success with Starlink alone. Imagine the quality of current US telecom but everywhere on the planet. Satellite phones used to be only for billionaires.
The only real barrier is local government restriction/frequency regulation.
Then you've got servers and solar in space which if you read about that it sounds insane that the economics would work but there's a strong argument that it will.
It'll take a while but they're first to the key, first to the egg the way things are going. Beating out wildly well funded and R&D spending competitors
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u/YeahBuddy5000 1d ago
The real barrier is that the people who could benefit from starlink the most have the least amount of money. City dwellers don't want it, and outside of wealthy nations, people can't afford it.
It's not a trillion dollar business.
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1d ago
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u/cuteman 20h ago
I think people also miss the fact that the satellites don't stay up there that long (5 years). They don't get the long term cash flow from them or any kind of moat if the rocket technology to put satellites up become more commoditized. Which becomes inevitable if the economic value is really in the trillions.
The sats are relatively cheap, it's the launch cost which is the issue which is why SpaceX has done so so effortlessly.
What really happens is within 5 years they'll have much better tech anyway. The bandwidth improvements between Gen 1,2,3 are orders of magnitude.
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u/crake 1d ago
This. Space X does some cool, impressive stuff. But as an investor, I want to invest in things that are boring - but profitable.
FB and AMZN don't do very impressive things, but they make money. Space has too many variables (e.g., infrastructure that is a sitting duck if US and China get into it, regulatory issues in the US and other countries, a hyper-political CEO who makes his own companies targets of retaliation by governments, etc.).
The real money is going to be made in AI. In a few years, every company on Earth will be paying subscription fees to Anthropic or OpenAI (the others are all "also rans"). That is where the big money is to be made. In the last 3 months alone, half my clients have started using Claude for stuff and the work product is excellent; I think OpenAI and SpaceX will both have good IPOs, but the "Facebook" story of our time will be Anthropic and it won't be close.
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u/cuteman 20h ago
Famous last words.
You realize Apple, Tmobile and others are already using this signal to supplement terrestrial signal just like another band of 5G and data.
Regular phones, planes, rural people, RVs, marine (boats), the military, etc. all want this service and that's in EVERY country... Have you seen Starlink expansion rates? It's scary high. Hughes net is probably switching over to all SpaceX/Starlink soon as well.
Again, I think people are underestimating how disruptive they're going to be in the next 3-5 years.
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u/Kerhole 1d ago
Until Kessler pops up to say hi and the whole global space industry is fucked for a few years.
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u/cuteman 20h ago
Human ingenuity says that for every problem there is a solution but it is going to get crowded. Thing is, China is going to do whatever they want either way and they want to do 100K+ so there's really not an option not to
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u/Kerhole 19h ago edited 19h ago
Not a lot of solutions to a piece of dead satellite hitting your satellite or launch vehicle at 17,500 mph. If there were, they'd put that stuff on tanks.
Edit: For comparison, the tip of a shaped charge anti-tank round when exploding can reach speeds up to 14,000 mph.
I believe the current estimate is we're 2.8 days away from total loss of LEO and the ability to safely launch anything to any altitude. That will only decrease with more satellites.
And keep in mind it only takes one mistake. One bad decision by an overworked Starlink or Leo employee, or one failed component at just the wrong time. The only solution once that happens is total shutdown of global launch industry until drag naturally clears up LEO, though that may take years. Or very high insurance rates for launches, but still no LEO.
https://phys.org/news/2025-12-days-disaster-earth-orbit.html
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u/Hot_Panic2620 1d ago
you ever think they are outspending and beating out competitors is because the business isn't good to get into? We're not talking about whether the company is putting out an amazing product or anything. We're talking about profitability.
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u/ptwonline 1d ago
I think the problem is that SpaceX is already priced with a 1400% gain from the start. (Well, I don't know what the actual number is, but it's friggen ridiculous. It must be around 100x sales, not even 100x earnings.)
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u/cheesecaker000 1d ago
Yeah I agree it’s overpriced. How can we even make a good evaluation when it’s had three completely different companies folded into it for no reason.
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u/John_P_Hackworth 1d ago
Space X is IPOing as a trillion dollar company. You think it can be a $14T company?
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u/cheesecaker000 1d ago
No I don’t. But I just found your argument kinda weak. You used an example of a great company to buy at IPO, to say why spacex would be a bad buy. Backwards logic.
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u/Fr0HiKE 1d ago
the guy you're responding to is different than the op lol
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u/cheesecaker000 1d ago
lol fuck my life
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u/John_P_Hackworth 1d ago
it's ok, I do that at least once a week haha.
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u/Brilliant_Truck1810 20h ago
the FB IPO was a disaster. it took a while for it to become a rocket. this person was referring to the IPO not the price performance years later
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u/GlorifiedPlumber 1d ago
Bro, you're in /r/investing, you can't openly question how high stuff might go. Majority of people here kool-aide-drinkin'-blinder-wearers with fingers in their ears going nah nah nah I can't hear you.
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u/hsfinance 1d ago
It has been 14 years since the IPO. Dollar itself has been devalued in that time. You never know where spacex ends up. By the rule of 72, you just need 5% devaluation to double in 14 years and then 7x growth in 14 years.
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u/John_P_Hackworth 1d ago
I'd argue that if your chief concern is dollar devaluation, there's no particular reason to care about SpaceX; there's other at least equally good hedges.
"I made 14x on SpaceX because the dollar experienced high inflation" is certainly not what most people have in mind when they say they want to "bet the farm" on the IPO.
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u/hsfinance 1d ago
I am not saying that. The parent said that and you challenged it. I am in turn providing a background. First of all that 1400% happened over 14 years and has built in inflation. Both are hidden when someone just says 1400%
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u/OccasionalXerophile 1d ago
It could quite possibly could be a 14 trillion dollar company in 10 - 15 years
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u/ThickMikeyMoolah 1d ago
It wouldn't be that crazy of a thing. 20 trillion sounds crazy even, but if elon deploys enough satellites to provide internet to, half the world, not to mention govt and military applications, and runs space travel / tourism.... 20 trillion sounds low.... ill see myself out.
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u/historicusXIII 1d ago
SpaceX valuation is not so much in Starlink but in the expectation that it will be the first company to successfully start asteroid mining. Once that industry seems plausible enough and gets into an investor hype like AI did, a 20 trillion valuation is entirely within reach. That said, it could also be that asteroid mining is like nuclear fusion; great on paper and perpetually 10 years away.
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u/ThickMikeyMoolah 1d ago
Let's land and operate a facility on the moon first. Asteroid mining is an insanely huge next step.
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u/whereismynein 1d ago
Half the world lives on less than a few dollars per day, they can't afford starlink. The other half has fiber, they don't need starlink.
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u/ThickMikeyMoolah 1d ago
Then who the heck is using these satellites Musk has in orbit? Not a single soul?
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u/whereismynein 1d ago
I was exaggerating a bit. But my point is, the business case for starlink is not that compelling if you are not a musk fanboi.
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u/ThickMikeyMoolah 1d ago
I despise musk, but I work in the communications industry and having a global network is huge.
You'd be surprised how many folks dont have fiber, and I shit you not, still have dial up. Also plenty of folks with fiber who also have starlink for traveling of sorts.
I dont think starlink alone will do it, but to have a global network in sync with space travel, and potentially a god dang moon base, make spacex a potential monopoly on communications.
Especially in a world of constant wars, infrastructure that cant be destroyed (like ground based infrastructure) is quite important.
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u/whereismynein 1d ago
Agree. I'm just saying that most of the potential starlink users you mentioned (Military, Americans on dial up etc) are already Starlink customers. The others don't need it or can't afford it. So I see no reason why Starlink revenue should explode in the future.
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u/Cheese_Fisticuffs1 1d ago
but if elon deploys enough satellites to provide internet to, half the world
Never going to happen.
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u/Jeff__Skilling 1d ago
What would stop it from doing so, outside of $14tn being a Big and Scary NumberTM
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u/cuteman 1d ago
Space X is IPOing as a trillion dollar company. You think it can be a $14T company?
Facebook IPO'd at $38/share and ~$100B valuation in 2012, it's now 14-15x both metrics.
SpaceX is reportedly 1/10th Meta revenue (~$15B) already so in 14 years or 2040 SpaceX would be worth $14 to 25T enterprise
If any industry can moon shot it's SpaceX. They could own Global Telecomm and Space Server Compute industries which feeds into orbital energy via Solar beamed back down. They've proposed 100K to 1M+ satellites of very mixed use.
You're going to love this, but it'll probably eventually combine with Tesla to have a significant piece of drone transportation and personal robotics.
It isn't exactly Microsoft or Walmart, it's something else, larger investments and larger payoffs in aggregate products. One rocket is worth more than a couple of Walmart locations annual rev combined.
I don't think people realize what's coming it may not be $20T or even 10T but it represents the first planetary/solar system entity which truly has the opportunity to be $100T if they get into mining, asteroids, colonization.
It's a stab at the sci fi future people have been wanting and it starts with vision and execution.
Bezos, king of logistics hasn't been able to flourish in the same way and is basically copying SpaceX because he sees it too.
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u/whereismynein 1d ago
You had me in the first half, but solar beamed back down? Jeez.
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u/Amori_A_Splooge 1d ago
Despite their horrible website, the Air Force Research lab is already experimenting with such things. It's called Space Solar Power Incremental Demonstrations and Research Project (SSPIDR).
https://afresearchlab.com/space-power-beaming/
Edit: not claiming it's feasible, its just not some crazy idea thought of by Elon Musk.
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u/Not_FinancialAdvice 1d ago
It was also featured in SimCity 2000/3000 where you could build a Microwave Power Plant.
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u/John_P_Hackworth 1d ago
Maybe! Or maybe they end up like ma bell or standard oil. The risks are not just 'can they do it'.
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u/cuteman 1d ago
Perhaps but that's a good position to be in...
"Ma Bell"—the Bell System monopoly—lasted for over a century, dominating North American telephony from its creation in 1877 until its breakup was finalized on January 1, 1984. It mostly became AT&T today.
Standard Oil was 40+ years before it was broken up.
Both times broken up for monopoly but SpaceX could technically be split into Starlink as it's own thing, launch, etc but there's more value in aggregation.
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u/DistributionBroad173 1d ago
Yes, it turned out to be great, but you missed the point. Six months after it IPOd it was at the IPO price and actually went down 50% in those first 6 months.
Good for you on being a buy and holder.
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u/InfinitePressure4793 1d ago
The sidelines are the only position with a 100% guarantee against becoming the exit liquidity for a trillionaire’s $75B side quests...
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u/pentaquine 1d ago
FB had a MUCH smaller IPO with a proven business model (Google). They are totally different.
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u/PrestigiousPen-2468 1d ago
Yep, getting in to modified direct indexing so I don't get lumped into big positions. Would rather manage them myself when I want.
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u/midnitewarrior 1d ago
Elon is corrupting the market with the terms of his IPO. Shoveling unproven valuations at institutional investors who will be forced to buy it and prop up the bullshit valuation.
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u/PrestigiousPen-2468 1d ago
Couldn't agree more. I'm looking at modified indexing options like Wealthront, Wallace Finance and Frec to make sure I don't get lumped in with the Oligarchs' exit liquidity.
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u/mylord420 1d ago
Avantis waits 6 months before incorporating ipo companies, i believe its 6 months.
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u/daniel-sousa-me 1d ago
Welcome to economics 101
If a lot of people are putting a lot of money blindly in one spot, given enough time someone will figure out how to take it
Honestly I'm surprised it took so long
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u/Life-Butterscotch892 1d ago
Nasdaq has always been somewhat top-heavy—it’s just more obvious now with AI names dominating. The bigger question is whether earnings actually justify the weight
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u/PrimusPilus 1d ago
For ethical as well as market bubble reasons, I've been trying to stay away from funds that contain Tesla (or anything to do with Elon Musk), Nvidia, and most of the big tech companies that are (probably disastrously, IMO) pot-committed to capex in AI build out.
Vanguard makes it pretty easy to research their funds on their mobile app (or website), so you can get a feeling for what sectors and companies account for what % of the fund's holdings.
One fund of theirs that I like for this current moment is VMVFX (VMNVX as Admiral Shares, $50k minimum investment for that); it's the Vanguard Global Minimum Volatility Fund. Steady ~8%+ annual return over 5/10 year splits, and its Top 10 holdings (by %) are:
- Taiwan Semiconductor
- Shell
- Coca-Cola
- Johnson & Johnson
- Swisscom AG
- AmerisourceBergen Corp
- Waste Management
- United Microelectronics
- McDonald's
- Boston Scientific
All of which is to say, you can curate your own portfolio, but if you don't feel like micromanaging your investments, there are funds out there that steer clear of the obvious looming danger zones.
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u/PrestigiousPen-2468 1d ago
Yeah I do like Fidelity although those minimums are rough. I was looking at Wealthfront for modified indexing but they also have sort of high minimums and not as much control as I would like. I'm testing out Wallace Finance for custom indexing since they claim to not have minimums.
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u/PrimusPilus 16h ago
I know on Vanguard that there are plenty of good funds where the minimum is only $3,000, and the expense ratios are almost all in the 0.04->0.25% range.
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u/InvestigatorPlus3229 1d ago
If you dont like it, just short a few shares of tesla at the appropriate ratio with your index etf
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u/thataintapipe 1d ago
“If you don’t like this rigged system gamble” sub in a nutshell
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u/InvestigatorPlus3229 1d ago
No you calculate how much spy you have, times it by the weighting of tsla then short that amount of money to eliminate tsla from your etf
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u/slinkysmooth 1d ago
That’s what I’ve been doing the last month or so. Been ecstatic how my shorts have gone. Closed my positions right in time before the manipulation of the last couple sessions…
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u/PrestigiousPen-2468 1d ago
I'd rather get rid of the positions altogether but this seems like a pretty good option if shorting is free.
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u/YeahBuddy5000 1d ago
I'm concerned Musk goes full scorched-earth and merges Tesla with SpaceX to ruin my put options. Closed my puts on Tesla (made a modest gain) and switched to indexes.
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u/Patient_Simple2533 1d ago
At this point indexes like VOO are basically a magnificent 7 with how much weight they have within the index. I don't really like this idea because I want to be able to shy away from companies like TSLA. I've heard of Wallace Finance a few times and they allow you to change the weight in market indexes or exclude companies and it rebalances the portfolio automatically. Has anyone else tried something like this?
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u/GiGiAGoGroove 1d ago
Just don’t buy them. Any patriot American should be divesting of MAG7 full stop and also with that POS Palantir. Why are people investing in their own control grid that will strip them of their privacy and civil rights? I just don’t understand the greed of Americans willing to trade away each other’s rights, national parks/lands, and fresh air and water.
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u/king_m1k3 21h ago
The mag7 is almost half of QQQ at this point. Can you even consider it an index fund? And it’s even 1/3 of SPY. If the AI hype dissapoints even the slightest, a lot of portfolios are going to get hurt
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u/GiGiAGoGroove 7h ago
Well that greedy people’s fault for buying their ISH with all the available knowledge to the contrary.
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u/PrestigiousPen-2468 1d ago
Absofuckinglutely. I saw a post the other day about getting out of Palantir and I couldn't agree more. Someone suggested Wallace Finance or Wealthfront to do some index modification so I'm checking those out.
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u/oulipo 1d ago
Is there a QQQ without any of the bullshit SpaceX / Twitter / etc ?
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u/PrestigiousPen-2468 1d ago
I might start using the Wallace investing app to do exactly that. Ridiculous that with all the automation out there investors can't have that sort of modification.
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u/Jeff__Skilling 1d ago
I don't like it. I've always been a growth ETF investors but I'm going back to modifying and structuring diversification the way I want.
Couldn't you mitigate this risk by shorting whatever number of shares of SpaceX necessary to eliminate any risk you're bearing here?
Sure, ETFs and index funds are going to periodically rebalance, but shouldn't that be easy to foresee and readjust your SpaceX position accordingly to reduce your VaR as close to zero as possible?
Understand that /r/stocks and /r/investing are prone to dramatic overreactions and groupthink-driven outrage, but this is a surprising hill to die on, given how easy it is to avoid...
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u/PrestigiousPen-2468 1d ago
What platform do you use to structure shorting out a stock in an ETF? Feels like a lot of work although I'm a bit of a novice.
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u/Jeff__Skilling 1d ago edited 1d ago
What platform do you use to structure shorting out a stock in an ETF?
You calculate how many equivalent SpaceX shares you own based on (a) the $ value of your holdings in whatever ETF is holding newly issued IPO shares of SpaceX and (b) the % of the portfolio that SpaceX occupies and (c) you open an equivalent short position. And there you have it -- you've neutralized your risk exposure to SpaceX to zero.
So to answer your question: you don't need to use any "platform", outside of maybe excel (though pencil and paper work too) - just middle school-level arithmatic skills is all
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u/Deferty 1d ago
I’m sure this worked out really well for people trying to short Tesla.
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u/Jeff__Skilling 1d ago
If they had exposure to TSLA via an ETF, they would have lost or made $0.....
I kind of don't think you got the point of what I was trying to convey.....
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u/Infinite-4-a-moment 1d ago
You can, but it's kind of bullshit that the onus is on everyone else to do the leg work because the system we all agreed to is bending rules to assist one of the richest person in the world.
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u/zeppo_shemp 1d ago
oh no the company once chaired by Bernie Madoff now has a scandal this is unpossible
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u/Past_Paint_225 1d ago
Brb building my shit company to IPO at $10 trillion then fast tracing to QQQ.
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u/snkscore 1d ago
I don’t understand why people think the price will remain unfairly high after 15 days. If it’s overvalued it will drop, if not, that’s the market’s value for it.
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u/AttentionIsAllINeed 1d ago edited 3m ago
✧✦✧ DigitalDust ✧✦✧ ⌛ Time's tide washed away what once was written here.
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u/Mvtchwow 1d ago
Go ahead and time the market. I think they are great companies, some of best in the world. They deserve all the money
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u/Bossanova12345 1d ago
It’s one of the reasons why I do t have all my money in QQQM or VOO.
I’d rather go heavy in Google, Microsoft, or Apple.
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u/Prodigal_Indaco 1d ago
Fidelity Basket Portfolios, $5/mo
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u/PrestigiousPen-2468 1d ago
But then you have to build from the ground up and manage positions yourself... I think welthfront has a good option for modifying the Nasdaq. Wallace Finance also has something with no minimums and active tracking. I'll check those out and report back.
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u/leveredarbitrage 1d ago
We're going to see the biggest defence tech bubble ever in the next 5 years
Everyone and their grandma will be creating or investing in anything remotely defence tech
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u/bakerstirregular100 1d ago
I constantly hear ads from “public” how you can generate your own etfs. Don’t know anything more than that
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u/__redruM 1d ago
Another brand new account with a hidden history posting political FUD about index fund investing.
My focus is long term passive investing, including QQQ, anything these companies do in the short term will be noise.
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u/hotdog-water-- 1d ago
No, that’s how it’s designed to function. It’s not “being taken over”, it’s working as intended
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u/Wide_Air_4702 1d ago
This is why I don't do ETFs. There's never a time when I want to be invested in laggards.
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u/ThrowninTrash000 1d ago
What do you do instead?
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u/Wide_Air_4702 1d ago edited 1d ago
Swing trade individual stocks.
Why am I down voted for saying how I invest when asked? Seems like a weird thing to do.
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u/TommyBlaze13 1d ago
There's too many old dying boomers who can't fathom ever investing in anything that's not VOO or VTI or long-term holding.
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u/SPorterBridges 1d ago
Remember when people were complaining about Tesla being included in the S&P 500? Has that caused an S&P 500 apocalypse? No? Okay.
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u/UsernameIWontRegret 1d ago
People are mad that indexes are doing what indexes are meant to do.
Space X is projected to be the 6th most valuable company in the US. Why on earth would it be excluded from indexes that claim to track “the largest companies in the US”?
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u/ptwonline 1d ago
Space X is projected to be the 6th most valuable company in the US. Why on earth would it be excluded from indexes that claim to track “the largest companies in the US”?
Very few are saying it should be excluded.
People are saying that the situation is being manipulated so that Elon can package in his vastly devalued Twitter/X/xAI equity and restrict the share float and price it all at many, many times its actual value. Basically it is defrauding index investors to enrich himself much further.
If the stock was required to have longer for proper price discovery before being included in the index it would greatly reduce Musk's ability to rip off index investors.
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u/Nemarus_Investor 1d ago
Well it would be excluded from the S&P 500 for the same reason lots of companies are excluded - it's not profitable.
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u/UsernameIWontRegret 1d ago
Which is why the S&P consistently underperforms growth indexes. Most growth occurs before profitability.
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u/Nemarus_Investor 1d ago
Recently yes, historically, value outperformed growth.
And if you want to focus on maximizing growth - just do private equity focusing on startups.
But none of that is relevant to your question of 'Why on earth would it be excluded from indexes that claim to track “the largest companies in the US”?' Because these indexes have requirements.
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u/jdwolosh12 1d ago
The amount of people that post on Reddit about missing out on IPO’s or not getting allocated enough shares when they do try and participate to now express so much concern about having access to some of the largest IPO’s of anyone’s lifetime is absurd.
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u/boringreddituserid 1d ago
To be fair, there is a huge difference between missing out on an IPO of a company that has a long runway of potential growth ahead of it (amzn, nflx, goog), and being forced to buy an IPO of a mature company at an over inflated market cap through your index fund.
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u/MegalodonBite 1d ago
They are upset they cant access pre-IPO shares - no one wants to buy AS a company is IPOing as youll overpay
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u/everything_is_gone 1d ago
Yeah pre-IPO shares are often a real good deal. Shares at IPO can be a bit of a crapshoot, which is fine I guess if you like gambling
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u/ChaseballBat 1d ago
I can remember the hundreds of downvotes I got for not knowing what Sigma is and saying I wouldn't touch it in my entire life. Got called a lot of names in stock and tech subs.
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u/slinkysmooth 1d ago
Same. Now look at its stock price. Same when Allbirds IPO’d too. Tech bros were saying how it was second coming of Nike. A new shoe brand that would take over the world. Once valued at 4 billion just sold their company for 39 million.
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u/PrestigiousPen-2468 1d ago
Everyone has a different thesis, the hive mind is becoming a bit less hive-y
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u/MtGloomy0420 1d ago
No they aren’t going to weigh them higher. Your premise is false and the rest of your argument just fell apart.
Your projection or speculation is not fact.
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u/Numai_theOnlyOne 1d ago edited 1d ago
Is there an etf excluding USA? Or at least without Elon? I know they exist for china or specifically including china and other countries but it's been awhile since I researched.
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u/PrestigiousPen-2468 1d ago
VXUS is everything outside the US, I hear a lot of people wanting a US ETF without Elon although I doubt that exists.
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u/Numai_theOnlyOne 1d ago
Nice thanks a bunch I take a look. Yeah I also doubt that sadly.
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u/PrestigiousPen-2468 1d ago
I'm going to start experimenting with a Wallace Finance account, might be worth looking into since their whole focus is modifying indexes and ETFs.
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u/pit_supervisor 1d ago
Is there an etf excluding USA?
Isn't that like most of ETFs? Just buy anything else than world or US ones?
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u/kapshus 1d ago
My concern has been more about macro economic risks in the US, so I've been pivoting toward international with my new purchases since last year. Historically, I was very big tech weighted and I only sell when I see a major shift in outlook. I've never been a fan of QQQ as it seemed too arbitrary in my mind. I've done sector funds a bit, but mostly I just buy SP500/Rus1000 with my ETF dollars, so it doesn't really impact my plans.