Global asset manager Franklin Templeton cautioned investors that even if initial public offerings (IPOs) of mega-sized unlisted corporations such as SpaceX, OpenAI, and Anthropic proceed, the impact on major indices and exchange-traded funds (ETFs) could be more limited than the market expects.
On the 18th, Franklin Templeton said in a report that the recent listings of large unlisted corporations are posing new challenges to traditional index construction. As corporations grow in private markets and go public at larger scale, their influence on index calculation has increased.
In particular, debate continues over how quickly to add large IPO corporations to benchmark indices. Some providers, including FTSE Russell and Nasdaq, are moving swiftly to reflect the next generation of large newly listed corporations in their indices, while S&P Dow Jones Indices is maintaining its existing, strict inclusion criteria.
It also said investors should focus on actual index weights and exposure rather than on corporation value or the IPO itself. That is because most global stock indices use a free-float–adjusted market capitalization methodology that reflects the number of shares actually available for transaction in the market, not total corporation value. As a result, it advised that investors should note the possibility that a stock could be included in an index at a relatively smaller weight than expected.
According to FTSE Russell analysis cited by Franklin Templeton, while SpaceX's total corporation value is about $1.5 trillion, its free-float market capitalization—shares actually available for transaction—is estimated at about $70 billion. Accordingly, SpaceX's expected index weight is forecast to be 0.11% in the Russell 1000 Index and 0.08% in the FTSE GEIS Developed Markets Index.
However, it noted that at first, founders, employees, and early investors are subject to lockups that restrict them from selling shares immediately after listing; once those measures expire and more shares enter the market, the corporation's weight in the indices could increase.
Franklin Templeton stressed that investors must understand exactly "what they hold." As large IPOs continue and index compositions keep changing, simply buying an ETF and leaving it alone makes it hard to grasp actual investment exposure.
Dina Ting, head of global index portfolio management at Franklin Templeton's ETF group, said, "ETFs that track broad markets remain an efficient investment tool, but indices keep changing with new listings, shifts in free float, and sector concentration," adding, "They are not suited to a set-it-and-forget-it approach."
She added, "With a series of large IPOs ahead, investors need to understand exactly what they are investing in," and, "It is worth watching how large corporations will change benchmark index exposure going forward."
Meanwhile, Franklin Templeton is a global asset manager founded in 1947. As of May 31, 2026, it manages more than $1.78 trillion in asset and provides investment solutions and wealth management services in more than 35 countries worldwide.