Nasdaq 100<\/a>, which it joined earlier this summer. The larger a company\u2019s weighting, the more influence it has on the index\u2019s performance.\n <\/p>\n\n The Nasdaq 100 weights stocks based on their market value and the number of shares available for trading. The index rebalances every three months and will rebalance in September, accounting for updated levels of publicly available SpaceX shares.\n <\/p>\n
\n After the IPO, the scarce supply of shares paired with intense interest from retail investors sent the stock soaring. But the stock has since tumbled, down roughly 50% from its record high on June 16 and down 20% from the IPO target price of $135 a share.\n <\/p>\n
\n Employees who have had shares awhile could have bought when the price was well below its current trading range. Those holders could be sitting on sizeable gains despite recent volatility, giving them an incentive to sell now, Lee at Direxion said.\n <\/p>\n
\n \u201cWith these employee share unlocks, you\u2019re going to have natural sellers entering the market,\u201d Lee told CNN. \u201cThese are people who\u2019ve (held the stock) far before it was printing at $135 on the IPO.\u201d\n <\/p>\n
\n Employees and early investors who have their shares unlocked could also decide to hold on to their stocks.\n <\/p>\n
\n When a company goes public, it often doesn\u2019t release all of its shares for public trading at once. Some shares are held by executives, others by funds and individual investors who got access when the company was private. Those pre-IPO shares can be subject to lockup periods.\n <\/p>\n
\n Typically, a company will instill a 180-day lockup period before pre-IPO shares become eligible to trade. SpaceX, however, is following a less common model. SpaceX has a staggered, tiered calendar for unlocking its shares for public trading.\n <\/p>\n
\n SpaceX has 7.571 billion Class A shares (mostly held by employees and investors) and almost 6 billion Class B shares (mostly held by Musk and executives). After Thursday\u2019s lockup expiry, a series of more unlocks this year could bring more than 5 billion of those Class A shares into the market.\n <\/p>\n
\n In 2027, extended lockup periods for company executives will begin to expire. Musk\u2019s shares \u2013 worth more than 40% of the company\u2019s value \u2013 are locked up until one year after the IPO.\n <\/p>\n
\n In the Nasdaq 100, SpaceX currently has a weighting of about 1%. At its current stock price, considering 911.5 million shares unlock Thursday, SpaceX\u2019s weight in the Nasdaq 100 could rise above 3.5% after the index rebalances in September, according to TD Securities. However, it all depends on how the stock performs.\n <\/p>\n
\n \u201cAn influx of new shares can weigh on any stock in the short term, but that doesn\u2019t change the underlying picture,\u201d Justus Parmar, founder and CEO at Fortuna Investments and a SpaceX investor, said in an email to CNN. \u201cWhat matters most is the strength of the business and Musk\u2019s ability to keep executing on the long-term vision.\u201d\n <\/p>\n","protected":false},"excerpt":{"rendered":"New York\u00a0\u2014\u00a0 More than 900 million SpaceX shares are set to unlock Thursday, more than doubling the publicly…\n","protected":false},"author":2,"featured_media":804678,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[27],"tags":[28],"class_list":["post-804677","post","type-post","status-publish","format-standard","has-post-thumbnail","category-business","tag-business"],"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/posts\/804677","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/comments?post=804677"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/posts\/804677\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/media\/804678"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/media?parent=804677"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/categories?post=804677"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/tags?post=804677"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}