FTSE Russell, Nasdaq, and S&P Dow Jones Indices have decided, through their respective consultations, what they'll do about new mega-cap companies going public.
In the most immediate terms, one thing that means is that shares of SpaceX, expected to hit markets soon, won't jump quickly into popular S&P 500 index funds.

Elon Musk's rocket startup is getting the Very Important IPO treatment -- with some caveats.

Major index providers, including the LSEG's FTSE Russell and the Nasdaq, have made it easier for new mega-cap stocks to land in their indexes. Those moves come ahead of expected offerings from SpaceX, as well as AI companies with massive private valuations, and they have some investors worried that the guardians of major market benchmarks were relaxing standards to stay relevant.

Space Exploration Technologies, or SpaceX, which could list next week under the symbol "SPCX," could gain fast-entry into some popular indexes, meaning buying from the funds that track those measures. Just not the S&P 500, which underpins the funds in which the great American investing public is most heavily invested.

WHY THIS MATTERS TO YOU

When SpaceX lands in public markets, its impact will likely be felt across a swath of investment funds, whether investors in those products wanted shares or not.

S&P Dow Jones Indices, a subsidiary of S&P Global, on Thursday said it won't make the proposed changes to eligibility criteria that would have shortened the seasoning period required before companies can join the benchmark index and eased financial requirements to make room for new companies with huge market valuations. (That means SpaceX, but likely also companies like Anthropic and OpenAI.)

The decision to keep unchanged rules governing the S&P 500, as well as the S&P MidCap 400, and S&P SmallCap 600, followed a committee's "review of the markets and after consideration of responses received from a wide range of market participants." Companies that want in will have to meet current profitability and public float requirements and have a listing history of at least 12 months to be considered. In other words: Size won't be the determining factor to get into the S&P.

That doesn't preclude mega-cap companies from getting fast-tracked into other S&P products, such as the S&P Total Market Index and Dow Jones U.S. Total Stock Market Index, neither of which have financial viability requirements for inclusion. (Some S&P indexes will also now see relaxed requirements for float, which could also ease entry for certain companies.)

The SpaceX IPO Will Ripple Across Indexes and Funds. Here's What That Means -- and Doesn't Mean.