To The Moon

Preface.

The race to explore the cosmos has never been more competitive, and SpaceX is right at the forefront of this new space age.

With its revolutionary technology, cost-efficient launches, and global projects like Starlink, SpaceX is changing the way space travel has been thought of and its commercialization in the future.

Space Mission Costs.

Cost is a major consideration, when it comes to launching payloads into space.

The National Aeronautics and Space Administration (NASA), an established leader in space exploration, spends a staggering $54,000 for every kilogram of payload sent into orbit.

In contrast, SpaceX has brought that price down to a low of $150 per kilogram.

Costs efficiency alone gives SpaceX a massive competitive edge, allowing them to offer affordable launch services to private companies, governments, and even non-profit organizations around the world.

It gets better.

While NASA's average cost per launch hovers around a massive $2.2 billion, SpaceX achieves the same mission for just $10 million.

The vast difference in cost is not just impressive—it is revolutionary for the future of space exploration and commercial space endeavors.

Launch Frequency

The rate at which SpaceX launches rockets is another area where the company shines.

SpaceX sends 135 rockets into space every yearly, in contrast to NASA’s 135 rockets over 30 years.

The exponential difference in launch frequency is a testament to SpaceX’s robust capacity to serve the commercial and scientific space markets.

The rapid pace also positions SpaceX as a dominant force in the space launch industry, enabling it to outpace competitors and meet increasing demand for space exploration.

Starlink Power.

One of SpaceX’s most exciting initiatives is Starlink, the satellite internet service.

While most people associate SpaceX with launching rockets, Starlink has become a key player in its long-term growth strategy.

The idea is simple yet ambitious: provide high-speed internet to remote and underserved areas around the world using a network of low Earth orbit satellites.

As of now, Starlink is already operational, offering internet to places that have long been left out of the digital revolution.

This not only creates a new revenue stream for SpaceX but also positions the company as a global leader in the telecommunications space.

With the potential to bring connectivity to billions of people, Starlink could significantly boost SpaceX’s profitability over the next decade, adding even more value to the company’s already impressive portfolio.

Valuation.

SpaceX’s meteoric rise in the space industry has naturally led to speculation about its valuation.

Two years ago, the company was valued at $100 billion, but with the continued success of its rocket launches, Starlink’s rapid expansion, its latest valuation stands at $350 billion.

As SpaceX is a privately held company, this means retail investors cannot buy its shares on the stock market - a challenge for those who wants to get in on the action.

How can retail investors participate, or are they doomed to miss the liftoff?

While an investor cannot buy SpaceX stock directly, he / she can gain exposure to SpaceX through closed-end funds (CEFs) that include SpaceX as part of their portfolio.

$Destiny Tech100 Inc(DXYZ)$ is one of such CEFs.

Over time, I have covered this CEF in a few posts:

• 12 Dec 2024 - SpaceX news sends DXYZ soaring to $185 ?

• 07 Dec 2024 - DXYZ surge +204% on SpaceX Open Tender news ?

• 26 Nov 2024 - SMCI and DXYZ Skyrocket, Thanksgiving Rally ?

• 18 Nov 2024 - DXYZ: Soars To $135 This Week? Possible ?

• 13 Nov 2024 - DXYZ outperforms TSLA, Worth The Hype ?

• 01 Sep 2024 - SpaceX - Investment New Frontier ! Invest now ?

In this post that I am sharing, it mentioned some downsides to CEF, in general:

• Investors may pay a huge premium to net asset value (NAV).

• Worst case scenario, it could be as high as 12.5x the underlying value.

• Additionally, those funds may charge management fees in the range of 2.5% to 3%, that could potentially erode long-term returns.

If you are put off by CEF’s supposed charges, I have another “good” news.

There is an alternate fund for considerations - $ERShares Private-Public Crossover ETF(XOVR)$.

XOVR - Smart Option ?

This is a more accessible & cost-effective way to invest in SpaceX - a compelling alternative.

This ETF provides exposure to SpaceX, that is the largest position within the fund.

Other key advantages:

• Daily liquidity, allowing investors to buy and sell shares like any other stock.

• No minimum investment, making it an option for retail investors of all sizes.

• A fee of just 75 basis points (0.75%), about a third of the cost of closed-end funds.

With XOVR ETF, investors gain exposure to SpaceX's incredible growth potential without dealing with the inflated premiums or high fees that come with other investment options.

SpaceX’s Growth Matters

Growing interest in SpaceX, (a) as a technology company and (b) investment opportunity, is no accident.

Its cutting-edge innovations are revolutionizing space travel and also setting the stage for future advancements in telecommunications, artificial intelligence, and global connectivity.

SpaceX represents a unique opportunity of a company that is paving the way for the next frontier of human progress.

Whether that’s providing internet access across the globe or transforming the commercial space market.

As SpaceX continues to break new ground, its valuation is likely to rise even higher.

This is the value proposition of this “space” inclined company.

ETF’s Sector Allocation.

Like DXYZ, this ETFs’ holdings have stocks from different sectors. (see above)

Top 3 sectors allocation - (1) Information Technology, (2) Communication Services and (3) Health care.

XOVR Top 10 Stocks

A drill down on the Top 5 Stocks in XOVR holdings yielded a surprise (to me, see below).

• SpaceX - 11.43%.

• $AppLovin Corporation(APP)$ - 5.49%.

• $Alphabet(GOOGL)$ - 5.10%.

• Nvidia (NVDA)$ - 4.86%.

• $Meta Platform(META)$ - 4.48%.

Applovin Corp.

• Apparently, APP is one of the “it” stock of late.

• YTD it has gained a whooping +736.69% (+$285.69 to $324.47 per share).

• A good selection for XOVR if it has gotten in early.

XOVR Performance.

This ETF’s performance is considered credible; especially its 1-Year performance coming in at 40.3%.

Apart from its “3 Years” performance that was an abnormally.

My Observations.

• Unlike DXYZ that holds more privately held companies (refer to my 12 December’s post), XOVR’s holdings have more listed companies, except for SpaceX.

• According to 24/7 WallSt, DXYZ holdings have over 37% of its holdings in SpaceX shares and its market cap is $763 million. (see below)

• XOVR on the other hand, have over 11.43% of its holdings in SpaceX. Its market cap is a smaller $272 million, a Micro-cap ETF, as shared by Market Chameleon.

• Based on just (a) SpaceX and (b) Market cap, DXYZ is comparatively more “valuable” than XOVR especially when SpaceX valuation continues to rise going forward.

• This explains the CEF and ETF price difference too.

• As of Thu, 02 Jan 2025 - DXYZ was $57.16 and XOVR was $18.19.

• DXYZ has fallen off its peak of late. However XOVR managed to keep its price around the $18 band.

• Last but not least, Morningstar has an analysis of XVOR that contains more breakdown details. (see below)

Based on XOVR’s 3 years performance:

• It is a growth, not value ETF with a low yield that corresponds to above table.

• It is a relatively high momentum, quality and volatility ETF.

• Its liquidity is ‘higher’ than average index.

• Rounding off ETF’s size as much lower-than average index.

In my opinion, both CEF and ETF options are a good way to get one’s feet jammed in the brightest star in $Tesla Motors(TSLA)$ group of companies.

With Tesla’s CEO closed link with the incoming president, the road ahead (at least the next 4 years) should be a ‘bright’ one for both Tesla and SpaceX.

Might be ‘late’ entry for Tesla now but SpaceX via DXYZ or XOVR, can consider ? I am still holding onto my token shares in DXYZ, at least for now..

SpaceX is shaping the future of space exploration. With it, the future of investment opportunities. With SpaceX’s recent open tender, are they planning an IPO in 2025 ?

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• Do you think XOVR will be the right investment for investors with small budget allocation ?

• Do you think DXYZ will the the right alternative for investors with deeper pockets?

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