Basically title. With SpaceX and whatever other fuckery they’re doing to the rules, the rumor is they want (in the US) to make it such that Broken Penis McShitGibbon is allowed to IPO.
The issue I am having is I am reading they want to change the rules so ETFs can start buying in weeks, not years.
So my question: for someone who’s pretty bogleheaded, what can I do to ensure that the funds I’m in don’t gamble on trash inflated valuations? Will I be able to make moves such that I’m insulated from Kaptain Ketamine? Yes you could say every AI stock could suffer the same issues, but I’m specifically worried about these companies that are fiducially questionable (criminals).
Every mutual fund and ETF has a prospectus document, somewhere, in which they detail their investment strategy. If you read those documents, you should have a pretty good idea of that the fund is allowed (and not allowed) to do.
However, the real issue is that many investors plow money into index funds whose purpose is to track the S&P, and the committee that oversees the S&P is bending over backwards to bend their rules to be able to include SpaceX 6 months after it's IPO, despite s lack of profitability. (It looks like the folks who manage the NASDAQ are also bending over backwards to getSpaceX to list there, and including it in the NASDAQ 100 early.)
But, one saving grace here is that the S&P appears to base it's weighting not on total company value, but on how much of the company is available to the Public to buy. Since SpaceX is only releasing 3 to 5% of the company in its IPO, some people are calculating that even when SpaceX hits the S&P, funds might end up only holding .5% or so in SpaceX. There are rumors, though, that there are employee held shares that might hit the market after the IPO to raise the float.
Ultimately, it's up to you to read all the documents and put your money where you think it is best. But, keep in mind that SpaceX might still go up before it inevitably crashes. I was concerned about the S&P 500's tech reliance a few years ago, and found a few funds which are explicitly "S&P minus the 7 big tech companies". But it turns out that most of the gains In the S&P have been in those companies. If I had moved all my money to the ex-Tech funds years ago, I would have been much worse off right now.
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