Jason Zweig

the companies that calculate which stocks go into which market benchmarks have been making all kinds of changes to accommodate mega IPOs like SpaceX and OpenAI and Anthropic.

The most prominent change is what's called fast tracking, which is adding the stock to the index as soon as five days after the IPO.

In the past, there was what was called a seasoning period of several months or, in some cases, as long as a year before a new company would be included in an index.

money.

These companies make billions of dollars a year through basically royalties that they charge index funds for the privilege of using the brand name of an index like the S&P 500 or the NASDAQ 100 or the MSCI World Index.

All of those index names are intellectual property, and they're probably the most valuable intellectual property in the stock market.

If you're about to go public and you know that a sizable amount of your shares will go into the hands of index funds very quickly, that should help stabilize your stock.

But also, it gives you comfort for the longer term because the investors in index funds tend to stay put.

Index funds are generating a lot of profit for the companies that build indexes.

And as an index fund investor, you and I need to monitor their behavior to make sure that they don't bend over backwards to accommodate companies going public because that's

The job of an index provider really should be to serve the best interest of the index, not the best interest of the issuing company.

And that's the thing that I'm really watching as this trend unfolds.

I want to make sure that somebody's watching out for me, not just for people like Elon Musk.

Thanks, Alex.

My pleasure.

So a tontine is an informal kind of insurance in which a group of people get together and they pool their money.

And as each member of the tontine dies off, the money is then redistributed among the survivors.

Members of some Tantines developed an unfortunate habit of murdering some of the other members to get the money early.

if you think about it, is in principle not that different from a lot of forms of insuring for retirement.

And it's an interesting metaphor for the risk that's inherent in every retirement system.