You Can Ignore AI Giants Like SpaceX, But Your 401(k) Won't

SpaceX’s stock price jumped 19.2% in its Wall Street debut, giving the company a $2.1 trillion valuation—larger than Exxon Mobil, Bank of America, and Coca-Cola combined. The market’s valuation of SpaceX could soon qualify it for major stock indexes, such as the Nasdaq 100, which tracks the 100 largest non-financial companies on the Nasdaq exchange. Index funds, which mimic these benchmarks, are increasingly popular among investors due to their lower costs and strong performance. Over the last decade, only 21% of actively managed U.S. stock funds outperformed their average index peers, according to Morningstar’s data through 2025. By 2024, more money was invested in index funds than in actively managed funds, and that trend has continued growing. Nasdaq recently updated its rules to allow large companies like SpaceX to join the Nasdaq 100 index after just 15 trading days, instead of waiting until an annual review. Funds tracking the Nasdaq 100, such as Invesco’s QQQ exchange-traded fund with $477 billion in assets, could automatically include SpaceX shares if it qualifies. Anthropic and OpenAI, two major AI firms, are also preparing for IPOs that could value them near $1 trillion each. These companies grew rapidly through private investments before going public, a trend that contrasts with traditional IPO timelines. The inclusion of SpaceX and other high-value companies in indexes could significantly impact investor portfolios, particularly 401(k) accounts tied to index funds. Many investors rely on these funds for long-term growth, and changes in index composition can shift their holdings without direct action. The shift toward index funds reflects broader trends in investing, where passive strategies have outperformed active management in recent years. As AI and tech companies continue to dominate market valuations, their inclusion in indexes may further reshape investment landscapes.