SpaceX is getting all the attention because in what’s expected to be a gusher of big name initial public offerings (IPOs) in 2026, Elon Musk’s rockets and satellite company is first on the docket with plans to potentially sell shares as soon as June.

Amid reports indicating SpaceX could come to market at a $2 trillion, that stock alone could have a profound impact on a variety of popular index funds and exchange traded funds (ETFs). For example, funds linked to the Nasdaq-100 Index (NDX) could include the space stock just weeks after its debut thanks to a fast-track rule recently implemented by Nasdaq.

Likewise, there’s speculation that after making Tesla (NASDAQ: TSLA) wait around for more than a decade before being included in the S&P 500, Standard & Poor’s won’t do the same with SpaceX. Of course, that was a result of the index’s profitability requirement – there’s nothing wrong with that, but it’s a different conversation.

What is relevant here and now is that SpaceX soon to be a public and Anthropic and OpenAI expected to follow suit later this year, some large, newly public companies are likely to have profound effects on a slew of popular index funds and ETFs as well as actively managed funds benchmarking to indexes such as the Nasdaq-100 and the S&P 500.

Concentration Risk Won’t Be Fixed

Don’t expect the IPOs of the aforementioned trio to solve the concentration conundrum in cap-weighted indexes like the S&P 500.

“The Morningstar PitchBook US Modern Market 100 Index illustrates that SpaceX, OpenAI, and Anthropic would instantly be among the largest publicly traded companies in the United States and that their inclusion in a broad-based index would slightly reduce concentration at the top of the market,” notes Morningstar’s Zachary Evens.

(Image Courtesy: Morningstar)

As the image confirms, Space X, OpenAI and Anthropic would all be top 10 holdings in the Morningstar Pitchbook US Modern Market gauge while resulting in only modestly smaller weights for entrenched incumbents such as Nvidia (NASDAQ: NVDA) and Apple (NASDAQ: AAPL).

Keep an Eye on S&P 500

Here’s what’s known in terms of how SpaceX could affect indexes and the funds tracking them. Nasdaq approved a fast-track and FTSE Russell, the provider of the Russell 1000 Index, is consider a similar move. If that happens, SpaceX and the others could enter the Russell 1000 and other widely observed FTSE Russell gauges prior to the quarterly rebalances – typically the first availability entry date for new arrivals.

For advisors and indexing nerds, the “wildcard” here is S&P because of the aforementioned profitability requirement. But it too is mulling fast entry rule change.

“S&P is reportedly considering a fast entry rule change to its flagship index, though it has not yet been approved, and details are scant. The S&P 500 index requires companies to have been public for at least 12 months with four consecutive quarters of positive earnings to be eligible for inclusion,” adds Evens. “Any rule change would be a watershed moment for this famous index. An unnamed committee decides which companies are eligible, and rule changes are almost unheard of. The committee tends to follow rules outlined in the index’s methodology, but there is still a level of discretion and opacity to the committee’s process.”

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