alt Hacker NewsAn passive investors are going to get hosed by this thanks to NASDAQ cooking the rules to favor Elon and his band of misfits.
No longer will there be a year of price discovery for index funds, 15 days. Meaning index funds have to buy it at the peak of the hype cycle. Will be a huge wealth transfer from mom and pop retirement accounts to the ultra wealthy.
Replies
Wow! This comment inspired me to dig deeper.
After 20+ years in the market, today I learned: "The S&P 500 is a float-adjusted, market-capitalization-weighted index."
So presumably an S&P 500 index fund is not disadvantaged, since it is tracking a float-adjusted index, i.e. the weight of SpaceX will be tiny if its float is tiny.
Or, is there a nuance that I'm missing?
> An passive investors are going to get hosed by this thanks to NASDAQ cooking the rules
I’m genuinely confused how a passive investor winds up tracking the NASDAQ 100 versus a broader index.
Also, if you’re picking and choosing your exposures, you aren’t passive.
Now I need a fund that will honor a year of price discovery rather than 15 days. Any recommendations?
They’re also reducing the float requirements, which is absolutely insane. As a passive investor with significant assets outside of tax-protected retirement accounts, I am beyond livid. If I have to switch investments to move away from the rules being changed out from under me, it will result in enormous tax consequences.
I don’t tend to let my emotions out this much here, but utterly fuck everything about this administration, and fuck anyone who voted in favor of it.
Huh, TIL, thank you.
Seems like MSCI can add new large constituents very quickly as well [1], so to remain neutral to the frenzy until a price has been discovered, one might need to actively short.
[1] e.g. https://www.msci.com/eqb/methodology/meth_docs/MSCI_GIMIMeth...
Does the hype cycle even last 15 days in 2026? It seems like they stabilize after a day or two. Happy to be proven wrong here…
You know what? I really don’t care. Anyone investing in anything Elon Musk owns deserves what they get.
My advice is to get out of all the capital markets and give everything you have away.
When index funds became such a default I knew they’d change the rules.
They’re taking everything thats not nailed down. A wealth tax is the only way, it cannot continue like this.