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| ▲ | BoggleOhYeah 4 minutes ago | parent | next [-] |
| This has been a thing in the CRSP indexes (ie. the benchmark for Vanguard’s VTI) forever. As long as it meets float and cap requirements, it’s inserted into the indexes five days after trading begins. It makes sense. They intend to track the market as it is. Though, you can definitely make the case that the popularization of index funds has allowed their holders to essentially become patsies to hype IPOs. |
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| ▲ | exabrial 8 minutes ago | parent | prev | next [-] |
| >The plan is to rapidly drive these prices up in the first 15 days, get the companies listed in the NASDAQ so funds are forced to purchase them at higher prices, then leave retirement accounts holding the bag. Dumb question: why couldn't retirement accounts simply not purchase these? |
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| ▲ | QuotedForTruth 4 minutes ago | parent [-] | | These funds don’t invest actively (picking individual stocks). Instead they invest in indexes that track larger portions of the market. So they’ll automatically buy once the company is listed on the NASDAQ. |
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| ▲ | noelsusman an hour ago | parent | prev | next [-] |
| Very few 401ks offer the NASDAQ 100 as an investment option. Last I checked it was <1%. |
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| ▲ | alemanek 11 minutes ago | parent [-] | | Total market indexes and target date funds will include this and SpaceX on float adjusted basis I believe. The blast radius is much larger than funds that track the NASDAQ directly. |
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| ▲ | findjashua 13 minutes ago | parent | prev | next [-] |
| almost all 401k plans offer funds based on s&p 500, not nasdaq/russell others. s&p has also halved their trading days requirement from 1 yr to 6 months, but that's still sufficient to be past the post-ipo lock-up period. |
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| ▲ | giarc an hour ago | parent | prev | next [-] |
| I get the sentiment that this is unscrupulous, however, isn't 15 days enough time to find the right price? Or will that not really happen until first quarterly earnings report, which will not occur within that 15 day window? |
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| ▲ | iTokio 32 minutes ago | parent | next [-] | | No, IPO pops, and honey moon periods are common. And there are plenty of ways to manipulate the price, such as issuing a low float to a hyper hyped stock.. | |
| ▲ | collinmcnulty 25 minutes ago | parent | prev | next [-] | | The fact that you know there’s a large pool of price insensitive buyers only 15 days away has to have some price impact. | |
| ▲ | FireBeyond 32 minutes ago | parent | prev [-] | | I mean the goal is that you have multiple earnings report to show sustainability. Meanwhile some of these companies are also lobbying to be able to only have to submit annual or biannual earnings reports, too. Everyone is looking for multiple ways to leave the dumb money holding the bag. |
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| ▲ | chinathrow an hour ago | parent | prev | next [-] |
| How do these people sleep at night coming up with schemes like that? |
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| ▲ | cryo32 15 minutes ago | parent [-] | | The use of people suggests they are human. I wonder sometimes. Edit: oh looky did I inflame the PE simians? |
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| ▲ | FireBeyond 37 minutes ago | parent | prev | next [-] |
| Very true. Anthropic just raised money at the end of last week. There's no way they could have done that without telling those investors the S-1 was prepared and awaiting their signature on the round before they hit Submit, so to speak. |
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| ▲ | cdelsolar an hour ago | parent | prev [-] |
| If you believe this is going to happen you can change the allocations of your retirement plans. |
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| ▲ | bittercynic 34 minutes ago | parent | next [-] | | You can protect yourself, but many won't be aware of the situation until it's too late, and institutionally managed funds won't be able to change their rules in time to avoid holding these as part of the index funds they hold. | |
| ▲ | yeswecatan 18 minutes ago | parent | prev [-] | | What should we be looking for? |
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