Australian billionaire Gina Rinehart’s $1.37 billion investment in SpaceX (NASDAQ:SPCX) is putting fresh attention on the ETFs that now give investors exposure to Elon Musk’s newly public company.
Rinehart’s investment firm, Hancock Prospecting, held 8 million SpaceX shares worth $1.37 billion as of June 30, according to a regulatory filing Friday. The position became her firm’s largest disclosed U.S. holding after Rinehart said in June that she had made a "significant investment" in SpaceX around its June 12 initial public offering.
For ETF investors, the timing is notable. SpaceX has quickly become part of the ETF landscape following its public-market debut, giving investors several ways to gain exposure to the stock beyond owning it directly.
SpaceX Lands in the Nasdaq-100
SpaceX began trading on Nasdaq on June 12 and was added to the Nasdaq-100 effective July 7.
That move brought the stock into a broad range of index-tracking ETFs, including the Invesco QQQ Trust (NASDAQ:QQQ) and Invesco Nasdaq 100 ETF (NASDAQ:QQQM).
The addition also created a potential source of passive demand. Nasdaq-100 trackers were estimated to need to buy billions of dollars of SpaceX shares to reflect the company’s inclusion in the index.
SpaceX’s initial weighting in the index is relatively small, however, meaning the stock remains a modest component of diversified Nasdaq-100 portfolios compared with larger constituents.
Leveraged ETFs Offer a More Concentrated Bet
Investors seeking a more targeted SpaceX trade also have access to single-stock leveraged ETFs.
The Direxion Daily SpaceX Bull 2X ETF (NYSE:LOFF), ProShares Ultra SpaceX ETF (NYSE:SPCF), T REX 2X Long SPCX Daily Target ETF (NYSE:SPAX), Leverage Shares 2X Long SPCX Daily ETF (BATS:SPCH), and Graniteshares 2x Long SpaceX Daily ETF (BATS:SPAL) are some examples of funds seeking to deliver twice the daily performance of SpaceX.
The products give traders a way to amplify short-term moves in SpaceX without directly purchasing the stock. But because they target daily returns, their longer-term performance can diverge significantly from twice the return of SpaceX.
Rinehart’s Bet Comes Amid Sharp Volatility
The billionaire’s investment also comes as SpaceX has experienced substantial volatility since its debut.
The stock initially climbed as high as $225.64 before falling to $104.83 in early August. It has since rebounded and moved back above its $135 IPO price.
That volatility seen in only two months of trading helps explain why SpaceX is becoming an increasingly relevant name for ETF investors even without a surge in dedicated SpaceX products. Broad Nasdaq-100 ETFs provide diversified exposure, while leveraged single-stock ETFs offer a much more concentrated way to trade the stock’s daily moves.
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