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

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)

How do I buy SpaceX stock?

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, Jay Ritter, a professor and Director of The IPO Initiative at the University of Florida, 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.

How do I buy SpaceX shares through a brokerage account?

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."