Investing $5,000 in the SpaceX IPO

When Space Exploration Technologies (SPCX +7.18%) opened to the public on June 12, it started trading at $150 per share, closing the day at just under $161.

Because of the price movements throughout that day, however, the returns, and in some cases losses, for anyone who bought shares on June 12 will vary greatly. Still, it’s possible to look at a few different scenarios and what those shares may be worth.

Investing $5,000 in the SpaceX IPO

For the returns for the SpaceX stock price, we’ll use the June 26 closing price of $153.23. But first, we’ll start with what that $5,000 investment may have bought investors. Since the price traded all over the place on IPO day, we’ll look at three potential price points at which shares may have been bought: $150, $160, and $176.

With such high demand for the stock, CNBC reported that investors were having difficulty getting their full orders filled at $150 per share. As one example from that report, one investor using Robinhood Markets requested 1,000 shares but only received 17.

That means, most likely, many investors were paying above $150 and up to $176, with a little more than $176 being the highest the stock price reached on the day. With the stock price closing just under $161, some investors may have bought shares around there, waiting until near the end of the day to see how things played out before making a move.

The early returns

Anyone who bought $5,000 worth of shares at $150 per share would have bought roughly 33 shares. With shares trading at $153.23 at the end of Friday’s close, that $5,000 investment would be worth $5,107.

Anyone who invested $5,000 and bought at around $161 would have received 31 shares. Those 31 shares were worth $4,750 at Friday’s close.

Finally, anyone who bought $5,000 worth of shares at around $176 would get a little more than 28 shares, making that investment now worth roughly $4,351.

Among the scenarios listed above, many investors may be looking at early losses or only slight gains. The good news for anyone who hasn’t sold is that those gains or losses are still just on paper. SpaceX hasn’t traded for an entire month yet, so its long-term potential is still evolving.

As a company with capital-intensive operations with bold plans to build artificial intelligence infrastructure in space that is also losing money, investing in SpaceX is about what’s possible in the future.

Focusing on the risks SpaceX will face, the rewards it can capture, and the volatility shareholders will need to stomach is more productive for shaping an investment decision than focusing on recent gains or losses.