Anyone know if vanguards VTI is immune from such practices?

cholmon 10 hours ago | parent | next [-]

VTI just tracks the CRSP US total stock index, see https://investor.vanguard.com/investment-products/etfs/profi...

The CRSP index itself adds new companies within 5 days of their IPO, see https://www.crsp.org/what-owning-the-market-really-means/

> The CRSP US Total Market Index, by contrast, adds all IPOs ranging from mega caps to small caps—accounting for 98% of the market—within the first five trading days of the stock’s listing.

So it sounds like SpaceX will show up in VTI sooner than in the Nasdaq100, even with their new "fast entry" rule.

	▲	gruez 10 hours ago \| parent \| next [-]
		The actual scheme described in the OP requires the multiplier to work, though. Otherwise it's just like any other company that's tightly held, in which case only the free float counts and the scheme unravels.
	▲	BoggleOhYeah 9 hours ago \| parent \| prev [-]
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bagacrap 9 hours ago | parent | prev [-]

vti is free float adjusted, so not as susceptible. But:

Elon will naturally do everything in his power to pump his stock, as every CEO does, and VTI buys shares in proportion to how successful that is. That is the nature of passive, market cap weighted investing.

If you want to underweight Elon's companies, or, generally, weight companies based on something besides market cap, you have to get into active or factor investing.

It mostly doesn't matter though, because if and when one stock drops, those investible dollars will likely flow into another stock, so VTI doesn't really care.