Keep pulling the thread on Dave Noddig.
SpaceX holds a virtual monopoly on space launch services in the United States.
SpaceX is planning to float only 5% of its stock in its initial public offering.
Despite its low 5% float, SpaceX is set to receive accelerated entry into the NASDAQ 100 index.
NASDAQ changed its rules to allow very large companies to be included in its indexes just 15 days after an IPO, a reduction from the previous six-month waiting period.
Under new NASDAQ rules, a company with a 5% float will be weighted in its indexes as if it had a 15% float, using a 3x multiplier.
The NASDAQ 100's 3x float multiplier for new large IPOs will apply until the company's actual float reaches 33%, at which point it receives its full market cap weighting.
Index funds tracking the NASDAQ 100 will be forced to purchase approximately $7 billion of SpaceX stock on its inclusion day.
Dave Noddig predicts that when SpaceX's 180-day IPO lockup expires and its float increases from 5% to 15%, NASDAQ will be forced to increase its index exposure from 15% to 45% of the company's market cap.
Barry Ritholtz speculates that NASDAQ's motivation for changing its IPO inclusion rules is to avoid repeating the S&P's perceived mistake of being late to add Tesla to its index.
Most of the growth in capitalism is now captured in the private equity space rather than in public markets.
The modern IPO market primarily exists to provide liquidity for insiders and early private equity investors, rather than to reward public market participants.
Unlike the historical expectation of an "IPO pop," newly public companies today often trade down initially after their IPO.