Written by: Fan Zhijing, CBN

SpaceX, the highly anticipated space exploration company, completed its listing on the Nasdaq Stock Exchange on June 12th, local time. Investors flocked to participate in this largest initial public offering in the world, betting on Elon Musk's vast business empire spanning aerospace rockets, internet services, and artificial intelligence.

By the close of trading, SpaceX's market capitalization surpassed $2 trillion, and after-hours market enthusiasm remained high, with the stock price rising over 1.5%. Next week, several leveraged ETFs linked to the company are expected to rise, potentially bringing greater market volatility.

Milestone Launch

SpaceX's IPO was the largest in history, priced at $135, giving it a market capitalization of $1.77 trillion. The stock opened at $150, and at one point during the afternoon session, it surged over 30% to $176.53 before fluctuating and closing at $160.99, a 19.22% increase. This propelled it to become the sixth-largest company in the US by market capitalization, reaching a total market value of $2.1 trillion. Elon Musk's personal wealth subsequently rose to approximately $1.05 trillion, making him the world's first billionaire with a net worth exceeding $1 trillion. This is equivalent to Switzerland's annual GDP, and according to the Bloomberg Billionaires Index, it's roughly equal to the combined wealth of the world's second to fifth richest people, and seven times Warren Buffett's $145 billion.

This listing is widely seen as a preview of the next generation of mega-corporations IPOs. Market participants are also using it to observe investor participation and assess the market trends for the upcoming IPOs of AI giants Anthropic and OpenAI.

The IPO fulfilled Musk's long-held vision of cultivating the aerospace and technology sectors, raising a total of $75 billion, more than double the amount raised by Saudi Aramco in 2019 when it set a record. Underwriters have the right to issue additional shares, a decision typically made within 30 days of the listing; if implemented, this could further increase the company's valuation.

SpaceX has also rewritten the rules of Wall Street's IPO process. While it cannot be included in the S&P 500 index for now, it will be quickly included in the Nasdaq 100 index under the new Nasdaq rules. At that time, passive funds and ETFs tracking the index will passively allocate to the stock, bringing new buying support to the share price. Joel Shulman, CEO of ERShares, commented, "Looking at the entire history of business, it's hard to find an entrepreneur who can compare to him. Musk is extremely visionary and his execution is outstanding." Under Nasdaq's new fast-track inclusion rules, the stock can be included in the index about a month after listing, while regular inclusions often have to wait up to a year.

Some analysts believe that SpaceX's IPO will trigger portfolio adjustments by investors. While funds flow into SpaceX, other leading technology companies may face selling pressure. On Friday, shares of a range of aerospace and satellite companies fell sharply, completely erasing gains since SpaceX filed for its IPO in April: Rocket Lab fell 8%, Intuitive Machines fell 12.5%, and Planet Labs fell 9%.

Despite the market's high enthusiasm for the IPO, pricing SpaceX reasonably remains a major challenge. The company's revenue in 2025 is projected at $18.7 billion, corresponding to a price-to-sales ratio of 94, with annual losses exceeding $4 billion. SpaceX claims it is targeting a market size of $28.5 trillion, declaring it the largest market opportunity in human history. Over the past three years, the company has carried out more than 80% of the world's payloads into low Earth orbit, and with the continued revenue generation from its Starlink business, many investors believe its foundation for growth is solid.

Analysts are divided on its valuation: Morningstar estimated its fair market capitalization at around $780 billion this month; CFRA initiated coverage of the stock on Friday with a sell rating. Nancy Tengler, CEO and CIO of Laffertendorf Investments, stated, "Investing in this stock isn't just about fundamentals; it's like Amazon in its early days—a company that revolutionized people's lifestyles. Even if the share price falls to $100, our long-term logic remains unchanged, and we want to participate in it for the long term."

Funds are eager to try

SpaceX expects only about 3%–4% of its shares to be freely traded.

The market's high enthusiasm for SpaceX's IPO has also spurred the launch of several new ETF products. Investors can use these leveraged ETFs to conduct high-risk leveraged trading of the stock after its listing.

Simeon Hyman, Global Head of Investment Strategy at ProShares, revealed on Thursday that following SpaceX's official listing this Friday, ProShares will launch a leveraged ETF next Monday—ProShares Ultra SpaceX, trading under the ticker symbol SPCF. The product aims to achieve twice the daily volatility of SpaceX's common stock. Hyman stated that the decision by companies like SpaceX to remain private for an extended period has created significant potential investment demand in the secondary market.

Meanwhile, Themes ETFs is also preparing two related leveraged products: a 2x leveraged long-only SpaceX ETF (ticker symbol SPCH) and a 2x leveraged short-only SpaceX ETF (ticker symbol SSPC). The company's chief revenue officer, Paul Marino, said on Thursday that the products are tentatively scheduled to officially list on the Chicago Board Options Exchange (Cboe) at 4:00 AM Eastern Time next Monday.

Ordinary investors can also indirectly allocate SpaceX stock through funds that track indices such as the Nasdaq 100. However, leveraged ETFs are extremely risky and not suitable for investors who want to hold the underlying stock for the long term. For short-term speculators, if SpaceX's stock price rises in a single day, leveraged ETFs will amplify returns; however, if the bet is wrong, losses will also be amplified.

Hyman cautioned investors trading this product to manage risk effectively and diversify their overall portfolio. He also noted that single-stock leveraged ETFs are currently one of the fastest-growing sub-categories within the leveraged ETF market.

Themes also cautioned investors about the risks of using its leveraged ETF to go long or short on SpaceX. In a product announcement Wednesday evening, the company stated that if the holding period exceeds one trading day, the fund will still incur losses even if SpaceX's stock price moves sideways. Traders could suffer significant losses if they misjudge the direction of the stock price. The announcement specifically warned that if SpaceX's stock price fluctuates by more than 50% in a single day, investors could lose all their principal within a single trading day.