NEW YORK: SpaceX is set to get a larger weighting in the Nasdaq 100 later this month, a change that could trigger billions of dollars of buying by passive funds tied to the benchmark.<\/p>\n
Its weighting is expected to rise to about 2.82% from roughly 1.28%, based on pro forma data from Nasdaq\u2019s Global Index Watch circulated late last Friday.<\/p>\n
The final weighting will be determined later this month.<\/p>\n
Wall Street expects the change to result in billions in new buying by index funds and exchange-traded funds that track the benchmark.\u00a0<\/p>\n
SpaceX\u2019s relatively small weighting dates to its addition to the gauge in July.<\/p>\n
Most of its shares were still locked up and unavailable for public trading, limiting the weighting it received even after Nasdaq changed its rules to allow newly listed large-cap companies to enter sooner and eliminated a requirement that at least 10% of their shares be publicly tradable.<\/p>\n
As those lockups expire, more SpaceX shares are becoming available for trading. That increases the company\u2019s free float, which can, in turn, increase its weighting in the Nasdaq 100.<\/p>\n
More adjustments may follow.<\/p>\n
Additional SpaceX shares are scheduled to come out of lockup, potentially lifting its index weighting again.<\/p>\n
SpaceX\u2019s first lockup expiration came in August, alongside its first earnings release as a public company, prompting concern that a surge in newly tradable shares could overwhelm demand.<\/p>\n
The selloff didn\u2019t materialise, including after a second lockup expired a week later. Insiders largely held onto their stakes and the stock held up.<\/p>\n
The Nasdaq 100 tracks the largest non-financial companies listed on the Nasdaq Stock Market.<\/p>\n
There is no minimum market capitalisation for inclusion, though companies must have average daily trading volume of at least 200,000 shares and meet other requirements.<\/p>\n
A higher weighting matters because passive funds tied to the benchmark must adjust their holdings accordingly.<\/p>\n
They include the US$481bil Invesco QQQ Trust Series 1, known as QQQ.<\/p>\n
Roughly US$1.7 trillion in assets tracked the Nasdaq 100 as of the end of the second quarter, according to Nasdaq. \u2014 Bloomberg<\/p>\n","protected":false},"excerpt":{"rendered":"NEW YORK: SpaceX is set to get a larger weighting in the Nasdaq 100 later this month, a…\n","protected":false},"author":2,"featured_media":600364,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[5],"tags":[138,1137,220,4245,111,139,69,295911,1503,4233],"class_list":["post-600363","post","type-post","status-publish","format-standard","has-post-thumbnail","category-business","tag-business","tag-equity","tag-markets","tag-nasdaq-100","tag-new-zealand","tag-newzealand","tag-nz","tag-rebalance","tag-spacex","tag-wall-street"],"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/posts\/600363","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/comments?post=600363"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/posts\/600363\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/media\/600364"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/media?parent=600363"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/categories?post=600363"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/tags?post=600363"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}