Benjamin Felix

Most major indices, as I just mentioned with Crisp, have a minimum float requirement and they weight stocks by their public float.

NASDAQ 100 is an exception to that.

We can talk more about that in a minute, but a company could go public while only making a small portion of their overall market capitalization freely available on public exchanges, which is often the case.

companies will tend to have 20 to 30% or something like that as a public float.

Some of these companies, I mentioned the FT article, it's speculated that these companies are going to go public with low public floats, like as low as 5%.

As I mentioned before, at a $1.75 trillion valuation for SpaceX, total market valuation at a 5% float, their weight in the eyes of indices is 88 billion, not 1.75 trillion.

Pretty big difference.

It's a huge difference.

100%.

So when we're talking about, oh, these companies are so much bigger, this makes this issue magnified.

Well, yes, if they floated 100% of their equity, yeah, it's a huge difference.

If they float 5%, it's a non-issue.

If they float 10% and they're able to enter the index at all, okay, now they're a whatever, one of the biggest companies that's ever existed.

Yes, but, and there is a but, so NASDAQ did change its rules, and I'm going to talk about that in a second.

A lot of the headlines are about the index providers considering changing the rules to accommodate these big IPOs.

But you're right, Ben.

As of right now,

this is actually not that much of an issue.

Unless you're investing in the NASDAQ 100, which you probably shouldn't be doing anyway.

That's a whole other topic for another day.