Author: Claude, Shenchao TechFlow
DeepSight Summary: On its first day of trading last Friday, SpaceX attracted net retail purchases of $1.17 billion, accounting for 56% of all U.S. retail stock buying that day. Research firm Vanda has introduced a new concept called the "FAB 10," proposing to replace the long-standing "Magnificent Seven" with a new group of leading frontier AI and technology companies, including SpaceX, OpenAI, and Anthropic. The latter two have not yet gone public but are expected to list later this year, with valuations potentially exceeding $1 trillion each.
SpaceX's debut listing is rewriting how Wall Street labels tech stocks.
According to a report released by Vanda Research last Sunday, as cited by Caixin, SpaceX’s IPO last Friday achieved tremendous success amid strong retail investor demand, sparking market discussions about redefining the entire technology sector. Prior to this, the offering, which raised approximately $75 billion, was the largest IPO on record; SpaceX priced its shares at $135 each, valuing the company at around $1.75 trillion and placing it among the top ten most valuable publicly traded companies globally.
On SpaceX's first day of trading, retail investors accounted for 56% of total market volume.
Vanda’s data provided a quantitative footnote to this frenzy: according to the report, SpaceX’s first day of trading attracted $117 million in net retail buying, accounting for 56% of all retail stock purchases across the U.S. market that day.
This figure reflects only retail purchases on the secondary market on the first day and does not include retail capital participating in the IPO allocation through brokers. Additional data shows that, in this $75 billion offering, retail investors ultimately received approximately 20% of the allocation—above average—while hedge funds secured 10% and long-term institutional investors acquired 70%.
The concentrated bets by retail investors have further directed capital toward a small number of mega-cap tech companies. Vanda believes these firms not only dominate market performance but are also driving the entire wave of tech investment.
Vanda: Replace "Seven Giants" with "FAB 10"
Based on this assessment, Vanda proposed a new classification framework.
"If the market over the past few years was dominated by the 'Big Seven,' last Friday may have been the clearest signal yet—that investors are beginning to focus on what we call the 'FAB 10,'" Vanda wrote in the report. FAB 10 stands for Frontier AI & Big Tech 10, referring to ten leading companies in frontier AI and big technology.
According to Vanda’s definition, FAB 10 adds SpaceX, OpenAI, and Anthropic to the original seven giants. The latter two have not yet gone public, but the market expects them to enter the capital markets later this year, with valuations potentially reaching hundreds of billions or even trillions of dollars.
Vanda's reasoning is straightforward: these companies collectively represent the direction of AI and the technology industry over the next decade.
The same concept, but Bank of America's version is different.
Packaging mega-cap tech stocks into a new index, Vanda is not the only player.
Previously, Bank of America’s chief strategist Michael Hartnett proposed an "AI Big 10" portfolio in his Guide to the Investment Universe. The key difference from the FAB 10 lies in stock selection: Bank of America’s version includes the seven giants plus Broadcom, AMD, and Micron, making it more focused on semiconductor hardware, while Vanda bets on unlisted AI model companies and SpaceX.
The discrepancy between the two lists essentially reflects different bets on who will define the next decade—one side bets on those building chips, the other on those developing models and launching rockets.
Retail investors flood into SpaceX, potentially draining liquidity from chip stocks.
The other side of the new concept is the reallocation of funds.
Vanda researchers note that SpaceX's popularity may be drawing capital away from other hot sectors, particularly semiconductor stocks that had previously surged, potentially losing favor with retail investors. In other words, even within FAB 10, gains are not evenly distributed—the new member's ability to attract funds may come at the expense of older members experiencing pullbacks.
However, analysts also cautioned that valuations across the entire technology sector are showing signs of a bubble. SpaceX’s $1.75 trillion valuation is itself based on optimistic expectations for AI infrastructure—and only the market can determine how long that optimism will last.