When this article is published, SpaceX’s much-anticipated IPO (the stock symbol will be SPCX after launch) should be a couple of days away. As I wrote this about a week ahead of publishing, the IPO is expected on June 12, and the IPO share price will be set on June 11.
I have been asked many times by subscribers how to invest in SpaceX before the IPO. While I’ll admit it’s not an area where I have much knowledge, I’m happy to share what I do know.
There are funds with significant (up to 30%) holdings in pre-IPO SpaceX shares, but I am not sure that investing in these funds will produce the hoped-for investment results. Otherwise, there are a couple of ways to get shares. One is a maybe, and one is a for-sure.
If you invest through one of the major brokerage firms like Schwab or Fidelity, you will be allocated pre-IPO shares that you can request to buy at the IPO price. Put in for IPO notifications with your broker, and you will be notified when SPCX shares become available.
When an IPO is listed, you will be able (if eligible) to enter a conditional offer to purchase. On Schwab, where I have my investments, look for “IPOs” under the “Trade” tab. Schwab says the cutoff will be at 4:00 pm the day before the pricing date, which, if the current expected dates hold, will be the day this issue is published, June 10 .
The conditional offer to purchase does not mean you will get shares. The brokerage firms will fill as much of the demand as they have shares available. SpaceX plans to make a significant amount of shares available for public purchase, but I also believe the demand will be huge.
The for-sure way to buy SPCX is to buy shares after they start trading on the exchanges. It is impossible to predict what the price will do on the IPO date and over the following days and weeks. I plan to pick up a few shares as soon as I can, and then be patient for the market to give some share pullbacks. I see SpaceX as a very long-term holding.
One point to keep in mind is that new Nasdaq rules allow shares of a large company to be included in the Nasdaq index (which includes the Nasdaq 100) just 15 days after its IPO. Index-tracking ETFs would have to buy shares—lots of shares. I would consider that two-week period a window of opportunity after the IPO to acquire shares, and then see what the price does once SPCX joins the Nasdaq-100 index before deciding on any further actions.
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