The upcoming SpaceX IPO is expected to be the biggest one in the world as the company will be valued at over $1.5 trillion. Some analysts and investors such as Ron Baron, believe that it will eventually be worth over $5 trillion. This article looks at some of the top stocks and ETFs set to benefit.
Scottish Mortgage Trust Will Benefit From the SpaceX IPO
London-listed Scottish Mortgage will be one of the top beneficiaries of the upcoming SpaceX IPO. That’s because the fund has been one of the longest holders of the company, which now makes up about 19% of its total assets.
Most importantly, the company offers exposure to some other high-flying unicorns. For example, Anthropic, which recently raised funds at a $900 billion valuation, makes about 2.5% of its portfolio. It also has a large stake in Stripe, a company that handles over $1.5 trillion in transactions.
Investing in Scottish Mortgage also gives you access to other blue-chip companies like NVIDIA, Taiwan Semiconductor, ASML, Amazon, and Bytedance, the parent of TikTok. This explains why the SMT stock has jumped by over 130% from its 2023 lows.
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Google is a Major Investor in SpaceX
Google is another top stock to benefit from the upcoming SpaceX IPO. The company invested $900 million in SpaceX in 2015, an amount worth $60 billion today. If it hits a $5 trillion market cap as Ron Baron predicts, the value will be worth over $375 billion.
Most importantly, Google is already a dominant player in key industries. It is the biggest player in digital advertising and one of the top names in the cloud computing industry. Analysts believe that its growth will continue, with the annual revenue coming in at $486 billion, up by 20% YoY.
ERShares Private-Public Crossover ETF (XOVR)
XOVR is another top ETF to consider as SpaceX prepares to launch its IPO in June. It is an ETF that invests in private and public companies, mostly in the technology space.
The fund counts SpaceX as its biggest holding, with a stake worth over $246 million. It accounts for about 20% of its total holdings. The other companies in the portfolio are companies like NVIDIA, Alphabet, Meta Platforms, AppLovin, and Astera Labs.
The only limitation for investing in XOVR is that it is a highly expensive fund with an expense ratio of 0.75%. In contrast, most blue-chip ETFs like VOO and SCHD have an expense ratio of 0.03% and 0.02%, respectively.
Bank of America
Bank of America, the second-largest bank in the US after JPMorgan, is also set to benefit from the upcoming SpaceX IPO. The company made a $250 million investment in the company in 2018 when it was valued at over $30 billion. This means that, at a $1.5 trillion valuation, the company’s stake is worth approximately $10 billion.
Still, the top beneficiaries of the SpaceX IPO are companies you cannot invest in. Excluding Elon Musk, its other top investors are companies like Founders Fund, Fidelity Investments, Andreessen Horowitz, and Sequoia Capital.
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