SpaceX added to Nasdaq-100 but slips below debut price — bet on the index-fund c
Thesis
When a stock joins a major index like the Nasdaq-100, passive funds that track the index are forced to buy it, creating a wave of structural support. SpaceX recently joined the index and has buy-equivalent ratings from major banks like Morgan Stanley and Goldman Sachs. However, the stock has fallen below its IPO price in a two-day slide. This divergence between the forced structural buying from the index inclusion and the short-term price drop suggests the selling pressure is temporary. As index-tracking funds complete their required purchases, the stock is likely to find a floor and revert higher.
Strategy approach
Build a rule-based strategy that enters long SPCX on D1 if the stock closes below its IPO reference price ($148) within the first 10 trading days of its index inclusion. Hold for 14 days or a 8% gain, whichever comes first, with a 5% stop loss.