Summary: Currently, investors cannot invest directly in SpaceX since it is not publicly traded. However, there are other ways for investors to gain exposure to the space technology giant. So, let’s take a closer look at SpaceX and how to buy SpaceX stock indirectly. Additionally, we’ll go through the risks involved in stock trading and provide you with an overview of the best brokers to use.
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What is SpaceX?
The company builds the Falcon 9, Falcon Heavy, and Starship launch vehicles, rocket engines, the Cargo Dragon and Crew Dragon spacecraft, and Starlink communications satellites.
SpaceX’s latest round of funding pushed the company’s valuation to $180 billion, making it the most valuable venture-capital-backed private company in the United States.
SpaceX IPO
SpaceX is still a private company and, as such, is not available to the investing public.
Therefore, currently, the SpaceX stock symbol doesn’t exist. Though the SpaceX IPO is eventually expected to take place as investors start looking for an exit, a registration statement has yet to be filed. There is no indication of when the SpaceX initial public offering (IPO) might occur. Thus, we don’t know when the general investing public could buy SpaceX stock.
This is because, unlike many private companies, SpaceX is under no pressure to hold an IPO as it has proven to be highly capable of attracting private capital. So far, it has been able to finance its programs without going public. In fact, SpaceX, as the most valuable VC-backed company in the US, qualifies as a decacorn (a startup valued at over $10 billion).
Recently, insider shares were valued at $112 each in a tender offer, raising SpaceX’s valuation to nearly $210 billion, making it the most valuable private U.S. company. This significant valuation boost aligns with its major public company counterparts like Wells Fargo (NYSE: WFC), Disney (NYSE: DIS), and McDonalds (NYSE: MCD).
Alternatives to buying SpaceX stock: How to invest in SpaceX
As mentioned above, because it is not publicly traded, you cannot buy SpaceX stock or invest in the company directly. Not yet, anyway.
The only way for the investing public to get a piece of SpaceX is to invest indirectly, i.e., to look for available alternatives in retail markets that provide exposure to the company. However, it’s crucial to keep in mind that indirect investments will always need to be assessed on their own merits, which may be significantly affected by other factors. Some options for indirect investments in SpaceX include:
- Funds and ETFs that invest in the aerospace industry;
- Public companies in the space technology sector;
- Partners or suppliers to SpaceX;
- Companies that hold substantial interest (ownership) in SpaceX.
Indeed, one of the best ways to invest indirectly in SpaceX is to invest in a company that owns shares in SpaceX. The most accessible is likely Alphabet (NASDAQ: GOOGL/GOOG), the parent company of Google, who, along with Fidelity (not publicly traded), has invested $1 billion in SpaceX. This gives them a collective stake of 10%. A complete list of the 86 SpaceX investors can be found here.
Note
The other investors in SpaceX, except for Bank of America Corporation (NYSE: BAC), are private equity firms, not public companies. Remember, both Bank of America and Google already have substantial businesses, which their stake in SpaceX is just a tiny component of. As a result, you should thoroughly investigate them before purchasing their shares as an alternative to buying SpaceX stock.
How to buy SpaceX stock? Step-by-step process
If you’ve decided to invest in SpaceX indirectly by buying shares in other companies that own an interest in SpaceX, here’s how to proceed.
Step 1: Choose a broker
To invest indirectly in SpaceX, you’ll need a brokerage account. While several platforms are available, the one that suits you will depend on your investment style (long-term buy-and-hold strategy or active day trading) and needs (e.g., whether you want to trade more advanced financial products such as options). When assessing brokers, consider the following features:
- Fees: Brokerage fees are a type of fee collected by brokers to execute your transactions or provide specialized services. Fortunately, today, the vast majority of online brokers offer commission-free stock and exchange-traded funds (ETF) trading;
- Security: Pick a trustworthy broker by ensuring it is fully licensed by state regulatory authorities as well as FINRA and registered with the Securities and Exchange Commission (SEC);
- Trading tools: Active traders may prefer brokerage accounts with all the bells and whistles. Some brokers offer fully customizable platforms with comprehensive analysis tools or access to additional data for an extra cost. If such additions are unnecessary for your purposes, avoid paying extra for them. It’s typically a good idea to look for a user-friendly platform with a competitive fee structure if you are new to stock trading. A dedicated section with investing tips and tricks is a bonus;
- Access to market data: You should search for a platform that allows access to solid market research and reporting tools to help you trade confidently with updated data;
- Fractional stock trading: Fractional shares allow investors to buy stock or ETFs by the dollar amount instead of the number of shares; especially helpful for investors who don’t have unlimited capital but want to build a diversified portfolio or are looking to set up a dollar-cost averaging strategy.
Where can I buy SpaceX stock?
Thanks to various online brokers, access to the stock market has never been more accessible as well as affordable.
To invest in SpaceX indirectly and buy shares in businesses that own an interest in SpaceX, consider these brokers:
1. eToro
- Commission-free stock trading;
- 2,000+ stocks from 17 exchanges;
- Fractional shares available;
- User-friendly platform.
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- Commission-free stock trading;
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- No account minimum.
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Step 2: Fund your account
Once you have decided on a broker, it’s time to fund your account. Remember, it can sometimes take up to three days for the money to reach your account and allow you to buy SpaceX-related stock.
Step 3: Research the Company
A way to invest in SpaceX is to buy shares of a publicly-traded company that is a significant stakeholder in SpaceX, such as Alphabet. However, if you buy Alphabet stock as an indirect investment in SpaceX, the performance of Google products and services will have a much greater influence on your acquisition than SpaceX’s success or failure. This is because Alphabet is already a sizable business with its own revenue streams, of which its investment in SpaceX is just a minor part.
As a result, performing due diligence on Alphabet’s business is essential before buying its shares. Fortunately, as a publicly traded company, Google’s quarterly (form 10-Q) and annual (form 10-K) earning reports, SEC filings, founders’ letters, product and business updates, as well as recent press releases can be accessed directly from its investor relations section.
After weighing both the expected risks and rewards, decide whether you want to buy GOOG/GOOGL stock as an indirect investment in SpaceX.
Step 4: Decide how much you want to invest in buying SpaceX stock alternative
Now that you’ve decided on a suitable asset for an indirect investment in SpaceX, you’ll need to determine how much you want to invest.
The amount of money you invest ultimately depends on the share price and the amount of SpaceX-related stock you want to buy. If the share price of a stock you’re interested in is financially out of reach, you can also explore fractional shares. Fractional shares allow you to purchase shares on the dollar amount you’re comfortable with, so you may end up with less than a whole share, a whole share, or more than a whole share.
Because investing can have unpredictable returns, it’s essential only to invest what you can afford to lose and to be mindful of your risk appetite.
Step 5: Place your order and buy SpaceX stock alternatives
Once you decide on the number of shares or the dollar amount you’d like to purchase, you can place your order. If you’re working with an advisor, tell them the stock you’d like to purchase and how much you can invest, and they’ll do it for you. If using a brokerage account, simply log in and enter the ticker for your chosen stock in the search bar.
There are a few different execution options to choose from, including:
- Market order: A market order is an order to buy the stock at the current market price that is generally executed immediately (subject to availability);
- Limit order: A limit order is processed once the stock reaches your specified price;
- Options contract: Options speculation allows for leveraged positions in a security at a fraction of the cost of the underlying asset. A call option allows the trader to profit if the price of the stock increases, and a put option enables them to profit if the stock price declines. Remember, derivative instruments can only be traded on a margin account, which typically has higher minimum balance requirements than standard brokerage accounts.
Step 6: Monitor your investment
It is crucial that you keep periodically checking in on the performance of the stock you buy as part of your indirect investment in SpaceX.
For example, keep a close watch on company press releases, health indicators such as revenue and net income, market prospects, as well as the overall state of the economy. Besides looking at a company’s fundamentals, you can use technical analysis to evaluate the stock and identify trading opportunities in price trends and patterns seen on charts. Then, depending on your financial goals, use that knowledge to reassess whether it’s best to hold onto the stock or sell it.
Tip
You may also want to track the performance of similar stocks in the industry for comparisons, such as The Boeing Company (NYSE: BA) or Virgin Galactic Holdings, Inc. (NYSE: SPCE).
Common mistakes to avoid when you buy SpaceX stock
Mistakes are expected when investing in stocks but can be avoided if you recognize them. For an in-depth guide on investing mistakes, we have compiled a list of 17 common mistakes and tips for preventing them. But, for now, let’s list some of the most typical ones:
- Not performing your due diligence on the stock;
- Having unclear financial goals;
- Attempting to time the market;
- Failing to diversify;
- Letting your emotions rule the investment decision-making process.
How to sell a stock?
You can sell the shares of your investment if you see the company performing differently than expected or after reaching your desired financial goal.
If you’re working with an advisor, they can create a sale order for you. However, if you have your own broker account, simply log on, navigate to the stock’s detail page, input the number of shares or dollar amount you want to offload, and tap sell.
Pros and cons of buying SpaceX stock
Pros
- SpaceX is operating in sectors with enormous growth potential: The demand for both space aviation, as well as the communication technology sector, is likely to increase;
- High valuation: SpaceX is particularly successful at raising capital. In fact, the latest round of funding values the company at $137 billion.
Cons
- Not publicly listed: SpaceX is still a private company, thus not available for retail investors as a direct investment;
- The product doesn’t have enough reach: Though the potential of SpaceX’s projects has stirred significant excitement among investors, the commercial space travel market is still relatively small, putting a ceiling on the company’s revenue potential (at least in the short term);
- Changing macroeconomic conditions: SpaceX has massively benefited from generous capital investment in the low-interest environment over the past decade. However, as rates tighten, funding for future-oriented projects might dry out.
In conclusion
Buying SpaceX stock while it operates as a private company will largely be out of reach for the average retail investor. Fortunately, the investing public can find alternatives among publicly-traded companies and ETFs that offer indirect exposure to SpaceX.
Disclaimer: The content on this site should not be considered investment advice. Investing is speculative. When investing, your capital is at risk.
FAQs about how to buy SpaceX stock
What is SpaceX?
SpaceX is an American space aviation company that designs, manufactures, and launches space equipment, including satellites and spacecraft. It was founded in 2002 by Elon Musk, who also remains the company’s CEO, Chairman, and CTO.
How to buy SpaceX stock?
SpaceX is a private company, and you cannot invest in it as a retail investor. However, you may consider investing indirectly by buying shares of companies with investments in SpaceX, such as Google or Bank of America.
What is SpaceX stock symbol?
Currently, SpaceX isn’t a publicly traded company. Therefore, the SpaceX stock symbol doesn’t exist.
How much is SpaceX stock?
Its latest funding round values SpaceX at $137 billion. However, since the company is not publicly traded, it doesn’t have a price per share for retail investors.
Is SpaceX a dividend stock?
Unfortunately, SpaceX is not a publicly traded company and it does not pay dividends to shareholders.
Highly Rated Stock Trading & Investing Platform
-
Invest in 2,800+ stocks and other assets including 70+ cryptocurrencies and commodities.
-
0% commission on buying stocks - buy in bulk or just a fraction from as little as $10. Other fees apply. For more information, visit etoro.com/trading/fees.
-
Copy top-performing traders in real time, automatically.
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eToro USA is registered with FINRA for securities trading.
