SpaceX shares have jumped over 40% in just two days of trading. On June 12, SpaceX shares opened at $150, against the IPO offer price of $135, and closed at $161, up 19% on the first day of trading.
On Monday, June 15, the second day of trading for Elon Musk’s 2.54 trillion-dollar market-cap company, the share price jumped 19.6% to close at $192.50. In just two trading days, SpaceX’s stock price has rallied 42.5% from the IPO price, and over 28% from the day one open price, which was the listing price. On Tuesday, SpaceX trades at $219, up by 13%.
For Indian investors watching from the sidelines, here’s the good news: you don’t need a fortune to participate. Thanks to fractional investing, even a budget of Rs 5,000 can get you a stake in SpaceX.
At an exchange rate of around Rs 94, Indians looking to buy 1 share of SpaceX at a price of nearly $200 will have to shell out Rs 19,000. However, as US stock market rules allow investors to own ‘fractional shares’, one may even invest an amount as low as Rs 5,000, or even a lower amount, to own a portion of any US stock, including SpaceX.
But, here’s a caution: At least two big risks exist for SpaceX stock in the near term. The volatility could be huge with Options trading starting from June 17, and once the lock-in ends for institutional and other investors, a sell-off can be seen in the stock.
Fractional Investing
The US Securities and Exchange Commission (SEC) permits fractional ownership of equities, enabling individuals to purchase fractional shares of major companies in the S&P 500 or Nasdaq 100 for as little as Rs 500, making access to US equities more affordable.
Dollar cost averaging (DCA), which functions similarly to a Systematic Investment Plan (SIP) in mutual funds, is another benefit of buying stocks through fractional ownership. Investing a set amount at regular intervals to purchase more shares (or a larger portion of a share) during periods of low prices than during periods of high prices is known as DCA.
The term fractional investing describes stock ownership of less than one complete share. For example, if a company’s stock sells for $1,000 per share and you buy $200 worth of it, you will possess 0.2 or 20% of a share.
One can even invest in Tesla stock for Rs 5,000 per month or purchase fractions of Nvidia, Amazon, Microsoft, and Apple for Rs 50,000 per month, allowing for the creation of a long-term portfolio of US companies within a budget. Simply decide how much you need to invest, and the number of shares will be automatically calculated for you.
Fractional investing enables portfolio hedging through overseas diversification on a limited budget, allowing the creation of an international stock portfolio in fractional shares of leading US companies.
The process of investing in US stocks involves opening a foreign trading account with an international brokerage firm. After completing KYC and complying with RBI’s LRS rules, which the brokerage assists with, trading in US stocks can begin. With fractional investing making even the most expensive US stocks accessible at a few thousand rupees, there has never been a better time to think beyond domestic markets and build a truly global portfolio.
Disclaimer: This article is for informational purposes only and does not constitute financial, investment, or legal advice. Investment in foreign securities involves significant risks, including currency fluctuations, different financial reporting standards, and varying regulatory environments. It is not a recommendation to invest in any specific U.S.-listed stock. Readers are advised to consult a qualified financial advisor before making any investment decisions.
