You might want to tune out the endless noise surrounding Elon Musk, high-profile IPOs, and SpaceX. Your 401(k), however, won't have that luxury.
Following a spectacular Wall Street debut where its stock surged 19.2%, SpaceX is now valued at a staggering $2.1 trillion. Whether or not you believe a rocket company deserves to be worth more than Exxon Mobil, Bank of America, and Coca-Cola combined, the broader market has made its decision. If SpaceX maintains this massive valuation, it is on a fast track to join some of the world's most influential stock indexes.
These indices generally don't care about a CEO’s public antics or how realistic a company’s long-term growth plans are; their sole purpose is to reflect the performance of the market. If SpaceX is big enough to meet the criteria, it will gain entry—whether that happens in a few weeks or a year.
The Power of the Index
This shift matters immensely for everyday savers because modern 401(k) accounts rely heavily on index funds, which passively mimic these market benchmarks. It is a highly effective, low-cost strategy that allows investors to keep more of their returns. Historically, these passive funds consistently outperform actively managed portfolios.
According to Morningstar data through 2025, a mere 21% of actively managed U.S. stock funds managed to survive and beat their average index peer over the last decade.
This stark performance gap explains why investors have poured more money into passive U.S. index funds than active ones since 2024—a trend that continues to accelerate.
Understanding the Major Benchmarks
To understand how SpaceX impacts your money, it helps to look at how the investment industry measures the market:
The S&P 500: The undisputed heavyweight of Wall Street. It tracks 500 of the largest U.S. companies, with trillions of dollars either directly invested in it or benchmarked against it.
The Nasdaq 100: A tech-heavy index tracking the 100 largest non-financial companies listed on the Nasdaq exchange.
The Dow Jones Industrial Average: While famous for its 19th-century roots, it only tracks 30 legacy stocks, meaning modern Wall Street pays it relatively little attention.
Because index funds control such a massive slice of global wealth, inclusion is a massive win for any corporation. Stock prices frequently skyrocket the moment index providers like S&P Dow Jones, Nasdaq, or FTSE Russell announce a new addition. According to the Investment Company Institute, there were over 1,000 index funds available at the end of last year—185 of which tracked the S&P 500 alone.
Redefining the Rules for "Mega" IPOs
In response to SpaceX's massive debut, the Nasdaq recently adjusted its rules, allowing ultra-large companies to enter the Nasdaq 100 just 15 trading days after going public. Previously, the exchange made investors wait until its annual reconstitution every December.
This rule change directly impacts popular products like Invesco’s QQQ exchange-traded fund, which manages roughly $477 billion. As a result, QQQ holders will soon automatically own a piece of SpaceX without lifting a finger.
This sense of urgency is driven by a fundamental shift in how tech giants grow. Companies like SpaceX, Anthropic, and OpenAI reached near-trillion-dollar valuations entirely in the private sector, fueled by venture capital, sovereign wealth, and pension funds. Because they delayed going public for so long, the investment industry is being forced to rewrite the rules to integrate them into public indexes immediately.
| Company | Estimated/Current Valuation | Profitability Status |
| SpaceX | $2.1 Trillion | Net loss of $4.9B (2025); Net loss of $4.3B (Q1 2026) |
| OpenAI | Approaching $1 Trillion (Expected IPO) | Private / Pre-IPO |
| Anthropic | Approaching $1 Trillion (Expected IPO) | Private / Pre-IPO |
Not Everyone is Fast-Tracking Progress
While the Nasdaq is moving quickly, the S&P 500 is taking a more conservative approach. To qualify for the S&P 500, a company must:
Trade on an eligible public exchange for at least 12 months.
Report a net profit in its most recent quarter, as well as a cumulative profit over its last four quarters.
SpaceX currently fails the profitability test. The company lost $4.9 billion last year, tacked on another $4.3 billion loss in the first quarter of 2026, and openly acknowledges it "may not achieve profitability in the future." Given that stock prices ultimately track long-term earnings, this financial drag has some investors worried.
The Governance Backlash
The forced inclusion of SpaceX has also sparked a fierce corporate governance debate. Last month, officials representing major pension funds for firefighters, teachers, and public workers in California and New York sent a joint letter to SpaceX expressing deep concern.
Because their pension funds automatically buy into index funds, these public workers will soon involuntarily become SpaceX shareholders. They are highly critical of the company's dual-class stock structure, which grants Elon Musk hyper-weighted voting power.
In the letter, the CEO of CalPERS and the comptrollers of New York State and New York City warned that this structure gives Musk absolute authority over the board of directors, "essentially making him unfireable without his own consent."
What Can Investors Do?
By definition, an index fund must buy every stock in the index, regardless of controversy or valuation. Tesla, for instance, has faced intense criticism for years over its premium valuation, yet it remains firmly entrenched as one of Wall Street's 10 largest companies.
If you want to avoid specific companies or corporate governance structures, you have to look for specialized alternatives. For example, investors seeking to avoid certain controversies often pivot to vehicles like the S&P 500 ESG Index, which famously removed Tesla in 2022 based on its environmental and corporate governance criteria. Otherwise, if you own the market, you own the whole ride—rockets, risks, and all.
The world's richest man has become even richer. Elon Musk is now the world's first trillionaire, following the record-breaking valuation of SpaceX, his space, telecommunications and AI company.
— Al Jazeera English (@AJEnglish) June 14, 2026
Al Jazeera’s Julide Ayger explains. pic.twitter.com/zmyDywsztF