The price you pay for a stock shapes your return more than almost any other decision you make about it. With a brand-new stock, you rarely get to choose that price.
In an initial public offering (IPO), the underwriting banks set the offer price the night before trading opens. Most of those shares go to institutions and the banks’ favored clients.
You buy the next morning, at whatever the opening trade decides. For decades, the gap between those two prices has been a piece of market trivia.
This summer, the largest IPO in history turned it into a dollar figure you can measure on a $10,000 investment.
Now one of the most-followed voices in personal finance is telling her audience to think hard before chasing the next hot debut, and the SpaceX numbers show why.
Vivian Tu takes aim at buying IPOs
Vivian Tu released an episode of her podcast, Networth and Chill with Your Rich BFF, on Sept. 23 titled “Why Buying Into an IPO Is Usually the Worst Trade You Can Make.”
The episode description explains the timing. “IPOs are having a major moment; SpaceX just had the biggest IPO in history, Anthropic and OpenAI are lining up next, and suddenly everyone’s throwing this term around like they know what it means,” it reads in the show’s feed, as listed on Listen Notes.
Tu traded equities at JPMorgan (JPM) before building her Your Rich BFF audience. She announced her own financial app, Ask Dolly, on the show’s Sept. 9 episode, so the channel carrying this IPO advice also markets a money product.
Following her IPO advice doesn’t route your money to anything she sells, though. It asks you to rethink a trade, and the SpaceX math shows what’s at stake.
How a $10,000 SpaceX stake fared since June
SpaceX (SPCX) priced 555.6 million shares at $135 on June 11, raising $75 billion in the base deal, TechCrunch reported. Proceeds reached $85.7 billion after underwriters sold extra shares through the overallotment option, according to TheStreet.
The stock opened at $150 on June 12 and traded as high as $162 that session, CoinDesk reported. It closed at $161, up 19%, according to NPR.
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SPCX closed at $154.72 on Sept. 22, according to Investing.com and MarketBeat.
I ran the numbers on $10,000 at each price. Bought at the $135 offer price, that stake was worth $11,460.74 at the Sept. 22 close, a gain of 14.61%.
The same $10,000 bought at the $161 first-day close was worth $9,609.94, a loss of 3.90%. That’s a $1,850.80 gap on the same company, from purchases made one trading day apart.
Those figures leave out fees, taxes and commissions, and they assume your broker lets you buy fractional shares.
The 19% first-day pop went to someone else
SpaceX’s first-day gain from $135 to $161 works out to 19.26%. The average first-day return on U.S. IPOs from 1980 through 2025 is 19.0%, according to University of Florida professor Jay Ritter’s IPO statistics, last updated Sept. 14.
SpaceX’s debut landed almost exactly on that 45-year average. That gain belongs to whoever got shares at the offer price, and allocations to individual investors were thin.
Retail demand was heavy. One investor requested 1,000 shares and received 17, TheStreet’s Damilola Esebame reported in June in a piece on the tough call facing small investors.
Wall Street wants more of you in these deals. IPO momentum is “supported by financial sponsor exits and increasing engagement from retail investors,” Eddie Molloy, global co-head of equity capital markets, said in a May 27 report from Morgan Stanley (MS), one of the banks that earns underwriting fees when IPOs price.
Financial sponsors are the private equity and venture firms selling their stakes to the public.
SpaceX share price, June to September
- Offer price, June 11: $135.00
- First trade, June 12: $150.00
- Session high, June 12: $162.00
- First-day close, June 12: $161.00
- Peak close, June 16: $225.64
- Close, Aug. 5: $108.27
- Shares released from lockup, Aug. 6: 911.5 million
- Public float after that release: 11.8%, up from 4.9%
- Close, Sept. 22: $154.72
New listings mostly trail the S&P 500
Across roughly 1,500 IPOs from 1995 through 2025, the average first-year return was 10.4%, while the median was negative 4.7%, according to a June 15 commentary from LPL Research, part of LPL Financial (LPLA).
Only 40.6% of those stocks beat the S&P 500 in their first year. The average stock’s worst drop from peak to trough was 48.9%, the same research found.
A positive average paired with a negative median means a few big winners carry the group. The typical new listing, the one in the middle of the pack, lost money.
SpaceX followed that pattern. It peaked at a $225.64 close on June 16, then fell 52.02% to close at $108.27 on Aug. 5, below its own offer price.
The stock has since recovered, but anyone who bought at the peak close was still down 31.43% as of Sept. 22. TheStreet tracked the $600 billion drawdown as it happened.
This year’s IPO class offers fresher examples. TurboGen (TRBG) priced at $10.82 on Sept. 3 and traded at $3.58 in Renaissance Capital’s recent pricings table as of Sept. 23, down 66.9%.
Jersey Mike’s (JMKE) priced at $23 on July 29 and traded at $18.42 in the same table, down 19.9%.
3 checks before buying a newly public stock
In my analysis, three steps matter most before you put money into a newly public company.
- Check the lockup calendar. A lockup bars insiders from selling for a set period after the IPO. SpaceX released 911.5 million shares on Aug. 6, more than doubling its public float, with further releases scheduled through year-end, Yahoo Finance reported.
- Use a limit order. A limit order caps the price you pay. SpaceX traded between $150 and $162 in its first session, and a market order fills at whatever price is showing when it executes.
- Size the position for a big drop. LPL’s data put the average IPO’s worst peak-to-trough fall near half its value, and SpaceX topped that in the seven weeks after its June 16 peak.
You can see lockup releases coming. The Financial Industry Regulatory Authority (FINRA) requires the lead underwriter to announce any lockup release or waiver “through a major news service” at least two business days ahead, under Rule 5131.
Index inclusion can add a second wave of buying that has nothing to do with the business. SpaceX’s weight in the Nasdaq-100 more than doubled in a later rebalance, TheStreet reported, which pushes funds tracking that index to buy more shares regardless of price.
More big listings are lining up behind SpaceX
U.S. IPOs have raised $146.5 billion across 109 deals so far in 2026, according to Renaissance Capital. Proceeds are up 392.3% from the prior year, even with fewer deals.
Anthropic filed confidentially for an IPO on June 1, and OpenAI followed on June 8, LPL Research reported in its June 15 commentary.
Either deal would carry the same structure that produced SpaceX’s $1,850.80 gap, with the same allocation math behind it.
If you would rather not chase a debut, the 10-year Treasury yield was near 4.95% on the morning of Sept. 22, the Associated Press reported.
The next big debut will offer the same choice: an offer price you probably won’t get, or an opening price you will. Tu’s warning gets its next real test when one of those deals prices.
Related: Invest in yourself now: Influencers Vivian Tu, Simran Kaur explain
