economy
Should you invest in SpaceX and the other AI IPOs?
Financial experts weigh in on whether you should buy shares in the mega-cap IPOs.
TL;DR
- SpaceX and major AI companies are expected to go public soon.
- Experts like Tyler Gardner and Don Butler advise against investing in these IPOs.
- Concerns include overvaluation ('priced to perfection') and historical underperformance of IPOs against the S&P 500.
- Retail investors buying into IPOs can drive up valuations, benefiting early institutional investors.
- Early investors may sell after the lockup period, causing stock prices to fall, as seen with CoreWeave.
- Exposure to these AI themes can be gained through index funds like the S&P 500, which already heavily features tech and AI firms.
- An alternative is to invest in public companies that already have stakes in these upcoming IPOs, like Google's ownership in SpaceX.