Nasdaq has changed how its flagship Nasdaq-100 index works, and the timing is no accident. SpaceX is heading for an IPO that could value it at up to US$1.75trillion, and the rule changes that took effect on 1 May 2026 are tailor-made for exactly this listing. If you own a Nasdaq ETF – and a lot of South African investors do (either on the JSE or the QQQM)- you are about to own SpaceX.
Two changes matter
The first is a Fast Entry rule. A newly listed company whose market cap would land it in the top 40 of the Nasdaq-100 can now be added to the index just 15 trading days after IPO, instead of the previous three-to-twelve-month period. The second is the removal of the 10% minimum free float requirement. In its place is a sliding weighting rule: companies with a free float below 33% are weighted at up to three times their float market cap, with full listed market cap only counting once a float crosses that one-third threshold.
The reason this matters is that SpaceX is reportedly going to float only around 5% of its stock. The old rules would have kept it out of the Nasdaq-100 entirely – neither the seasoning period nor the float minimum were going to be met. SpaceX moved its listing to Nasdaq from NYSE weeks after these rule changes were proposed. The sequence is hard to miss.
How much SpaceX will Nasdaq ETF holders own?
At a US$1.75trillion valuation and a 5% float, the float-adjusted market cap is roughly US$87.5billion. Multiply by the 3x cap and we get US$262.5billion of “index weight” basis. Against a Nasdaq-100 total market cap of around US$39.3trillion at the end of March, that lands SpaceX at roughly 0.7% on day one – somewhere around the 25th-largest holding in the index.
That is the starting point. SpaceX has built in release valves that let insiders sell sooner than the usual lock-up allows, which is the company’s way of pushing float higher and faster. Get to about 11% float and the weighting climbs to roughly 1.5%. Get to the 33% threshold and the 3x multiplier no longer binds because full market cap takes over – at that point SpaceX is a 4% plus position in the Nasdaq-100, comfortably top 10 and not far behind Microsoft.
For the South African investor this means the Satrix Nasdaq 100 ETF (STXNDQ) will pick up SpaceX, likely by the end of June. There is no opt-out. That is the deal with passive – we hold what the index holds. Bloomberg estimates that Nasdaq-100 and S&P 500 tracking funds will between them have to buy close to a fifth of SpaceX’s available float on day one, which is a lot of forced buying that has nothing to do with whether the price is right.
To be clear, Satrix has no say in this.
They simply mimic the Nasdaq 100 weightings.
Here is the bigger issue
Index methodology is supposed to be neutral. We choose a tracker because we want a defined, rules-based exposure to a defined market. When the index provider rewrites the rules to accommodate one issuer – a company that wants the indexing flows that come with inclusion but not the discipline of a real float – that neutrality is gone. The Nasdaq-100 in May 2026 is not the same product it was in April.
We have seen the pattern before. Yahoo was the warning shot back when index changes around a single name moved billions of dollars at the turn of the millennium. SpaceX is the sequel, and the dollars are much bigger.
I’m not saying SpaceX is a bad business (but it certainly is expensive and it turns out, actually an AI stock). I am saying that when the rules bend to fit the company, rather than the company fitting the rules, every passive investor in that index is living with the consequences. Worth asking yourself, when you next top up an STXNDQ position – are you still buying what you thought you were buying?
What about other ETFs?
For me personally my preferred tech ETF has always been the 1nvest ETF5IT which I hold and SpaceX is not likely to be included as it is not a Information Technology stock.
Further, for the S&P500 index the top level rules remain in place and are;
- A seasoning period (typically 6–12 months of trading history, though the Index Committee has discretion)
- Positive GAAP earnings in the most recent quarter and summed over the trailing four quarters — SpaceX reported a $4.9bn net loss for 2025, which fails this test as filed
- Adequate float, liquidity, and a US domicile
For the MSCI indices SpaceX may well qualify for early inclusion or it’ll have to wait for the August Quarterly Index Review or November Semi-Annual Index Review. Importantly, no rule were changed to make this happen. The only concern may be free float, but they have ways to manage that and with lock ups all but gone within 180 days the free float will be fine.
Below is a video on the issue I was sent via Twitter over the weekend as I was writing this that confirmed my fears.
ETF blog
At Just One Lap, we are big fans of passive investment using ETFs. In this weekly blog, we discuss ETFs on the local market and the factors you need to consider when choosing an ETF. If you have wondered how one ETF differs from another, this is where you can find out. We explain which index each ETF tracks, what type of portfolio could benefit from holding each ETF, and how the costs will affect your bottom line.
