The shadow market anticipates SpaceX's first-day surge exceeding 35%; Asian investors, unable to participate directly, are flocking en masse to “indirect alternatives” such as supply chain stocks, ETFs, and perpetual futures. But history warns: over the past 15 years, large tech IPOs have averaged a 55% drawdown within one year.
Shadow market pricing signals suggest that Elon Musk’s SpaceX (SPCX) could see a significant surge upon its public market debut.
Data from derivatives, crypto trading, and prediction platforms collectively indicate that this company, which operates in rocketry, satellites, and artificial intelligence, may significantly outperform its offering price on its first day.
Derivatives pricing from online broker IG International shows that during Friday’s Singapore trading session, SpaceX’s implied enterprise valuation was pushed to approximately $2.4 trillion. This represents a gain of over 35% compared to its IPO price of $135 per share, corresponding to a $1.77 trillion valuation.
Transactions from the crypto market also provide reference. On the Hyperliquid platform, the perpetual futures contract tied to SpaceX is quoted at approximately $174, implying a company valuation exceeding $2.2 trillion. The contract recorded a 24-hour trading volume of $143 million, with an open interest of approximately $208 million.
In the prediction market, Polymarket traders' assessments further reinforce this expectation. Their data shows a approximately 70% probability that SpaceX will surpass a $2 trillion market capitalization on its first trading day.
This price expectation, shaped by multiple channels, reflects strong market demand for assets in both artificial intelligence and space infrastructure. If SpaceX achieves a strong market debut, it could set a precedent for future potential IPOs, including companies like OpenAI and Anthropic PBC, potentially validating their trillion-dollar valuations in public markets.
Fabien Yip, market analyst at IG International, said:
Demand for the IPO has remained strong, and pre-listing trading has generated significant interest. Even though the valuation appears already high, this remains our most popular pre-listing transaction to date. If the pricing momentum continues, it could set a precedent for upcoming mega-IPOs.
However, from a short-term capital flow perspective, if SpaceX delivers a strong debut, it could divert attention and investment away from existing large-cap tech stocks, including the "Magnificent Seven" and Tesla (TSLA). At the same time, its listing may also boost market performance for global companies related to its supply chain, industry peers, and existing shareholders.
The largest IPO in history, but Asian investors are being “shut out”—forced to rely on supply chains and ETFs for indirect access.
Around SpaceX’s $75 billion initial public offering, global capital is highly enthusiastic, but most investors in Asia face barriers to direct participation. This restriction on access forces regional capital to seek alternative pathways to capitalize on related opportunities.
In the absence of IPO allocation channels, traders in Seoul and other areas have increasingly turned to indirect investment methods, including allocating to supply chain companies related to the space industry, investing in thematic ETFs, and purchasing funds that track the Nasdaq-100 Index, aiming to benefit from potential price appreciation following SpaceX’s listing.
The crypto market has also become a significant channel for absorption. Investors continue to drive up the prices of perpetual futures contracts linked to SpaceX, while some trading platforms have introduced more complex derivative instruments, providing alternative investment options for capital unable to participate in the primary market.
Vantage Global Prime analyst Hebe Chen noted: “We are seeing growing interest from clients whose trading patterns and risk preferences exhibit an unusually diverse distribution. The level of interest surrounding SpaceX feels less like general IPO inquiry and more like investors trying to secure a seat before the rocket leaves the launchpad.”
Participation criteria vary significantly across markets. In the Asia-Pacific region, only Japan and Australia currently allow retail investors to participate directly in this IPO; individual investors in most other markets remain excluded.
Retail investors may get burned; historical data shows an average drawdown of 55% within the first 12 months after launch.
Reuters columnist Jamie McGeever wrote that, amid heightened attention, risks are accumulating, particularly among retail investors. As subscription barriers fall and access expands, individual capital is flowing in at unprecedented levels, yet structural arrangements and historical precedent indicate that such surges carry significant asymmetric risks.
In a traditional large-scale IPO, retail investors typically receive no more than 10% of the offering, with the remaining shares primarily held by institutional investors. This allocation structure helps mitigate the impact of initial price volatility on individual investors, as institutions possess greater financial resources and risk tolerance.
SpaceX has clearly broken this convention: of the total $75 billion offering, approximately 20% of shares will be allocated to retail investors. A higher participation rate means individual investors will be more directly exposed to the price volatility and potential drawdowns that may occur during the initial trading period.
Historical data suggests this concern is well-founded. According to Sam Grelck, equity strategist at Truist Advisory Services, a study of 30 major tech IPOs over the past 15 years showed that all of these companies experienced double-digit declines within 12 months after their first-day closing, with an average drawdown of 55%, and some stocks falling nearly 90%.
He warned: "Investors participating in new stock listings should be prepared for higher volatility and potential significant drawdowns."
A more granular time-based analysis reveals that the first three months after an IPO typically still generate positive returns, but with significantly higher volatility; however, over six-month and one-year periods, overall performance tends to turn negative. This indicates that short-term gains often coexist with medium-term pullbacks, resulting in a highly uncertain process.
Meanwhile, the relaxation of participation requirements is accelerating retail investor entry. Fidelity Investments has significantly lowered the account threshold for IPO participation from $500,000 to $2,000; Robinhood Markets, SoFi, and E*Trade even allow account participation with no funds required, while Charles Schwab’s threshold is $100,000. According to Vanda Research, the typical post-April U.S. tax season rebound in stock buying activity this year has not been clearly evident, partly because investors are raising cash in anticipation of SpaceX’s IPO.
Regarding fundamental expectations, the growth trajectory outlined by underwriters has also sparked debate. Goldman Sachs analysts project that the company’s total revenue will rise from $18.7 billion last year to $474 billion by 2030, with AI-related revenue growing from $3.2 billion to $3.22 trillion. Anthony Saglimbene, Chief Market Strategist at Ameriprise, commented: “By almost any reasonable standard, this is an extremely bold assumption.”
Another underwriter, Morgan Stanley, provided an even longer-term projection, suggesting that the company’s total revenue could reach $3.4 trillion by 2040. Such long-term forecasts, while expanding market imagination, also increase the uncertainty surrounding valuation realization.
Changes in the institutional arrangements are also worth noting. Typically, company employees must endure a six-month lock-up period after an IPO before selling their shares, but SpaceX has been exempted from this restriction. Some analysts note that this could allow employees and early investors to cash out shortly after the listing, shifting selling pressure onto inexperienced retail investors.
Although potential insider selling may be partially absorbed by retail buying, this hedging is not guaranteed. If buying pressure is insufficient, late-entry retail investors may suffer significant losses when the market price declines.
The overall market sentiment surrounding this IPO has also sparked discussions about the cycle’s position. Some argue that this concentrated enthusiasm may signal that the market is nearing a peak. However, Noah Weisberger, Chief U.S. Equity Strategist at BCA Research, noted that historically, only about 20% of mega-IPOs occur at market tops.
Notably, the market may see additional high-profile listings in the coming months, including OpenAI and Anthropic, each with projected valuations of up to $1 trillion. If SpaceX’s IPO performs strongly, retail investors may become even more enthusiastic about participating in subsequent large-scale IPOs; conversely, if it underperforms, individual investors who have committed significant capital could face substantial drawdown pressures.