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SpaceX IPO underperforms S&P 500, 8 of 10 largest US IPOs have fallen short of the index by a median of 127 percentage points, with SpaceX down 21% from its
Eight of the top 10 largest U.S. IPOs in history have underperformed the S&P 500 since going public, with a median shortfall of 127 percentage points, according to data from FactSet Research [2]. SpaceX, which went public last month with a record-breaking debut as the largest initial public offering in history by market cap, is currently down nearly 21% from its peak on June 16.
| At a glance | |
|---|---|
| SpaceX IPO valuation | $1.77 trillion |
| SpaceX net loss in latest quarter | $4.28 billion |
| S&P 500 ETF assets under management | nearly $2 trillion |
| Nasdaq 100 ETF fee | 0.10% |
The proliferation of Nasdaq 100 funds stands to boost shares of SpaceX, which is set to join the tech-heavy index next week [1]. State Street's SPDR Portfolio Nasdaq 100 fund launched last week, charging 0.10%, which is lower than the Invesco QQQ ETF's current 0.18% fee [1]. BlackRock's iShares also filed to launch its own product, which could further increase competition and drive down fees [1]. The S&P 500 ETF, on the other hand, is a more stable option, with decades of history earning positive total returns despite short-term volatility [2].
The decision by the index committee to maintain its 12-month waiting period for new stocks, including SpaceX, means that S&P 500 investors will not have exposure to the company's shares until at least mid-2027 [3]. This decision has sparked debate among experts, with some arguing that it sets a precedent for not adding other large IPOs, such as OpenAI and Anthropic, to the index [3]. The dueling decisions from index providers could create an "index war" and performance dispersions between the S&P 500, Nasdaq, and other indexes [3].
| ETF | Expense Ratio |
|---|---|
| Vanguard Information Technology ETF | under 0.1% |
| Invesco QQQ ETF | 0.18% |
| State Street SPDR Portfolio Nasdaq 100 fund | 0.10% |
The real significance of the SpaceX IPO and its comparison to the S&P 500 ETF lies in the debate over which investment is more lucrative, with history suggesting that the humble S&P 500 ETF could be a more stable and profitable option [2]. As the market continues to evolve, it remains to be seen how SpaceX will perform in the long term and whether it will be added to the S&P 500 index.
Coverage is mostly measured — 85 of 107 reports stay neutral.
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AI-assisted synthesis by the TrendWatcher Editorial Desk · sourced from 3 outlets · Jul 5, 2026 · How we report
According to FactSet data cited by The Motley Fool, eight of the ten biggest U.S. IPOs have underperformed the S&P 500, lagging by a median of 127 percentage points since they began trading.
VOO tracks the S&P 500 and includes all large‑cap U.S. sectors, while QQQ tracks the Nasdaq‑100, excluding financials and focusing heavily on technology, communications, and consumer internet companies.
Over the past ten years, QQQ returned about 571% compared with VOO’s roughly 320%, reflecting QQQ’s concentration in high‑growth tech stocks.
VOO’s broader diversification and lower fees make it a more stable core holding, whereas QQQ’s sector concentration can lead to higher returns in strong AI cycles but also larger losses during market volatility.
The sources present a neutral view, emphasizing diversification benefits of the S&P 500 ETF while noting the trade‑offs of more concentrated alternatives.