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Comment by pj_mukh | Hacker News Reader

Okay before we set off the alarm though, can someone tell me What percentage of these index funds will be SPCX and TSLA?

Like if both these stocks become penny stocks what happens to the indices?

Isn’t the whole point that they are hedged across the whole market?

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As of January, TSLA was somewhere around 2.3% of the S&P [1]. Because SpaceX will have so little float available, it would be somewhere around 0.7% if included.

[1] https://en.wikipedia.org/wiki/S%26P_500

Ya, but this is a proof-of-concept rip-off. The fact that the indexes don't have our back is a huge problem.

It's only a problem for the ones left holding the bag. I'm at an all-time low allocation percentage in the US stock market and considering pulling more out still. Full on casino vibes at this point.

It's doubled in five years while inflation's gone up by 30+ percent. Where exactly is there to hide? Not gold - that peaked and went down a lot. Let's not talk about BTC, either.

Real estate? You've got taxes on that in the US, it's how our governments can pretend to not tax us as much as in Europe while still taxing us as much as in Europe (property tax goes to schools)

What's left?

I mean, gold is up significantly more than then broad market since Trump took over, but that doesn’t mean you should gamble on it continuing.

I don’t trust real estate either. Seems like anything with a middleman is setting record levels of grift right now. I don’t trust the industries reports. No one is regulating or checking numbers.

I shifted into more bonds. Probably a bit early, but I’m not a pro. I’ve just lost trust in the market which no longer seems tied to reality or at least my limited understanding of reality. Staying in it just feels yolo atm.

> The fact that the indexes don't have our back is a huge problem

how could an index fund possibly have anyone's back? It's in index of the top 500 publicly traded companies. that's all. If SpaceX or Tesla or Anthropic or anyone else fall out of the top 500 then they fall off the index by definition.

I think a lot of these comments are coming from extreme emotions associated with AI and Elon Musk and not so much the way things work and will play out.

Because they are breaking all their own rules by removing the seasoning and profitability requirements to fast-track this stock in.

No, that's not all. They had additional criteria that they changed right when big-name companies wanted to get added. Now, if they had historically gone by pure market cap, and these companies met that, then you'd have a point.

Assuming $75B float for SpaceX

* S&P500: 0.08% – 0.12%

* NASDAQ-100: 0.47% – 0.70%

* Russell 1000: 0.1%

A key point to look out for is how much money Anthropic and later OpenAI will go for in their IPO, which will utilise the same (updated) rules.

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