How to buy SpaceX shares as its blockbuster IPO readies for liftoff

SpaceX is set this week to launch as a publicly traded company, giving ordinary investors a chance to participate in what is expected to be the biggest initial public offering of all time.

While SpaceX will be held primarily by CEO Elon Musk, company employees and private investors, the Texas-based company will set aside a sizable chunk of stock to retail investors, which experts say is unusual. Earlier this year, Reuters reported that as much as 30% of the shares of the rocket and AI company will go to individual investors, three times the usual allocation.

SpaceX shares are scheduled to price on Thursday and begin trading the following day on the Nasdaq Composite Index under the ticker symbol "SPCX," according to SpaceX's IPO website.

SpaceX said in a recent regulatory filing that it expects to price its shares at $135 each. However, the company could increase or decrease the price before trading begins, said Matthew Kennedy, a senior market strategist at Renaissance Capital, which tracks IPOs.

The company expects to raise $75 billion in the offering, nearly three times the amount raised when Saudi Aramco, Saudi Arabia's state-owned national oil company, went public in 2019, in what remains the largest-ever IPO.

SpaceX's offering would value it at $1.77 trillion, larger than many major U.S. companies that have been around for years. That includes Musk's electric car maker, Tesla, which has a market value of $1.5 trillion; Meta Platforms ($1.4 trillion); and Warren Buffett's Berkshire Hathaway ($1.04 trillion)

As SpaceX explains on its website, retail investors will need a brokerage account or a participating digital investing app to participate in the IPO.

"Your brokerage account or investing app will confirm whether you're eligible when you submit your request to participate," SpaceX says on its website.

SpaceX is offering shares to retail investors through Charles Schwab, E*TRADE by Morgan Stanley, Fidelity Investments, Robinhood and SoFi.

Kennedy of Renaissance Capital said that for most retail investors, those will be the five go-to platforms. High-net-worth individuals may also have access to the IPO through their own banking institution, he noted. "There might be some accredited investors that can access it through, say, JPMorgan."

After SpaceX shares begin trading publicly, anyone can buy them on the open market. People with index-based exchange-traded funds may also soon find that SpaceX stock has been added to their investment portfolio, experts explained. That means Americans may eventually see exposure to SpaceX through their 401(k)s.

Investors can normally access shares of a company before an IPO through so-called private-market transactions, which involve purchasing stock from an existing shareholder, such as a company employee. Participation is limited to accredited investors with certain asset thresholds, said Karthik Krishnan, an associate professor of finance at Northeastern University.

However, at least two platforms for such secondary trades — Forge Global and Rainmaker Securities — said they are no longer offering access to SpaceX shares.

"Opportunities for new private secondary transactions in SpaceX shares have become increasingly limited as market participants seek to hold their shares and shift attention to the company's performance in the public markets," Glen Anderson, CEO of Rainmaker Securities, told CBS News in an email.

Still, Ritter cautioned that such transactions can be complex, amplifying the risks.

"At this point, I would recommend, if you're not already an experienced investor on those platforms, this is not the time to start," he said.

Each brokerage platform offers its own instructions for how retail investors can participate in SpaceX's IPO. That generally involves setting up an investor profile, confirming your eligibility and submitting a request for the number of shares you want to buy.

"So you might say I want to buy up to 100 shares. Then the day before the company begins trading, you will get a confirmation," Kennedy said. "You'll have to confirm that you'd still like to buy up to 100 shares, and then the morning of the deal, the morning of the listing, you'll either get 100 shares or less."

As some brokerage sites note, requesting shares doesn't guarantee you will receive them — availability depends on supply.

"If you ask for 100 shares, maybe you'll get 100," said Jay Ritter, a professor and Director of The IPO Initiative at the University of Florida. "More likely... you'll probably only get a fraction of the shares that you asked for."

Here are the requirements for buying SpaceX shares after it goes public, according to leading brokerage firms:

• Charles Schwab. The financial service firm's IPO platform requires investors to have a "minimum liquid net worth" of $100,000, according to The Motley Fool, an investing advice company.
• E*TRADE. There is no account minimum to participate, per The Motley Fool.
• Fidelity. The company said anyone with a retail brokerage account with $2,000 or more is eligible to participate.
• Robinhood. No minimum account balance, according to The Motley Fool.
• SoFi. The digital finance company said anyone with an active investing account is eligible to participate in the IPO, with no minimum account balance required.

According to a recent SEC filing, SpaceX is offering 555,555,555 class A common shares as part of its "public float," the number of shares a company makes available for public trading. That's about 4.25% of the company's total stock.

Reuters, citing a person familiar with the matter, reported in late May that as much as 30% of SpaceX's IPO could be set aside for retail investors. The remaining 70% would go to large institutional money managers such as hedge funds or mutual fund managers, according to Kennedy.

Getting in on SpaceX shares at the offer price could yield higher returns, Ritter said. According to his research, which analyzed more than 9,200 IPOs from 1980 to 2024, the average return for a newly public company on its first day of trading is about 19%.

Kennedy, however, said it may be wiser for investors to wait and see how SpaceX's stock trades before taking the plunge, noting that shares can be volatile in the days immediately following an IPO.

Morningstar also thinks investors may be better off biding their time. The global investment research firm said in a research note earlier this month that it believes SpaceX has been "significantly overvalued" and that investors will have a chance to buy stock at "more attractive levels" after the IPO.