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siavosh | on: Nasdaq's Shame
Anyone know if vanguards VTI is immune from such practices?
cholmon | parent | next
VTI just tracks the CRSP US total stock index, see https://investor.vanguard.com/investment-products/etfs/profi...

The CRSP index itself adds new companies within 5 days of their IPO, see https://www.crsp.org/what-owning-the-market-really-means/

> The CRSP US Total Market Index, by contrast, adds all IPOs ranging from mega caps to small caps—accounting for 98% of the market—within the first five trading days of the stock’s listing.

So it sounds like SpaceX will show up in VTI sooner than in the Nasdaq100, even with their new "fast entry" rule.

gruez | root | parent | next
The actual scheme described in the OP requires the multiplier to work, though. Otherwise it's just like any other company that's tightly held, in which case only the free float counts and the scheme unravels.
stockresearcher | root | parent
Yes. As long as the free float is at least 10%, it will get the fast track into VTI. According to their methodology guide, they use free float for weights and total shares for ranking. So this IPO would be a mega cap with a tiny weight. Totally the opposite of what a manipulator would want!

https://www.crsp.org/wp-content/uploads/guides/CRSP_Market_I...

I know that a lot of Vanguard funds track CRSP indexes. Right about now is when I wish they had and ETF that tracks this one:

https://www.crsp.org/indexes/crsp-us-total-market-ex-mega-ca...

bagacrap | parent
vti is free float adjusted, so not as susceptible. But:

Elon will naturally do everything in his power to pump his stock, as every CEO does, and VTI buys shares in proportion to how successful that is. That is the nature of passive, market cap weighted investing.

If you want to underweight Elon's companies, or, generally, weight companies based on something besides market cap, you have to get into active or factor investing.

It mostly doesn't matter though, because if and when one stock drops, those investible dollars will likely flow into another stock, so VTI doesn't really care.