r/investing
So is SPCX price discovery even real right now?
Author doubts SPCX's price discovery, noting restricted selling from IPO allocators and insiders creates an artificial supply shortage.
- Current price surge is driven by excited buyers while natural sellers are discouraged from selling.
- IPO allocators risk losing future IPO access if they flip shares, suppressing natural sell pressure.
- Insiders and large holders are not actually selling yet, making the price discovery artificial.
I keep seeing people talk about the SpaceX price like it already proves demand is insane, but I’m still stuck on the selling side. If IPO allocated holders risk losing access to future IPOs by flipping, and insiders/large holders aren’t really selling yet, then how much of this is actual price discovery? A price can go up fast when buyers are excited and natural sellers are basically discouraged from selling. Maybe that’s just how IPOs work, but it feels weird watching everyone treat the first few days like a normal market.
As someone holding onto Virgin Galactic since forever, no
What we are discovering is Elon hate will occur at any price
Good news. If you're so sure you can finance your retirement with ease. Swing big feller.
There are large echo chamber groups and bot interactions that skew alot of things.
That's what upvotes do to a bunch of monkey brains in search for acceptance.
Early reddit people used upvotes for what upvotes were meant for "whether the discussion was productive/helpful". Now they are mostly whether people agree or disagree with you.
Detecting emotions is also a form of price discovery.
Identifying dreams is also a form of price discovery.
LOL
Yep. I hate most of Reddit with a passion but still come here daily to read stuff
SpaceX is very overvalued from the perspective of ratio of market cap to how much profit they're actually going to earn over the next 10-20 years.
It's not overvalued from the perspective of how much people are convinced the stock price is going to go up. Castles in the sky.
Elon will never sell his shares. He will have SpaceX buy TSLA though because then his trillion dollar pay package vests instantly.
And what was Arianespace max market cap? The market for putting shit in space doesn’t justify a 3T valuation.
SPCX will continue to rip the forseeable future, but that doesn't necessarily disprove anything Reddit is saying about it. I won't/wouldn't buy into a stock i know is overvalued even if I think it will continue to increase in value.
And people who would buy SPCX 100% don't care what it's priced at when they buy. Demand at any price will continue to push the price up (until it doesn't)
All this has just reinforced my view that stocks are nothing more than gambling where the winning tickets are determined by hype and nothing else.
It reflects reality in no way at all.
So it has 3 big bumps coming that everyone is aware of. VTI buying, QQQ buying and ITOT buying. Then it needs 4 profitable quarters for SPY and VOO.
This is combined against investor lock ups going into Q2 earnings.
So it’s going to squeeze, the major investors in the IPO will take profits and we get to see if retail can hold it up.
If one looks at Bitcoin one can see how irrationality can maintain price forever.
This is why index investing works, because the market decides who the winners are and kicks out the losers for you, no need to guess.
My coworker who is clueless on stocks bought a few thousand in shares because he said SpaceX has “no competition”. Multiply this by millions of clueless retail investors then demand outstrips supply and prices will rise regardless.