SpaceX IPO day - Trade in Venture

Issue 129;

Today, we take profits on one of our best-performing holdings, Seraphim Space Investment Trust (SSIT). When we first recommended it on 25 November 2024, we wrote,

“While space may or not become a desirable holiday destination, it will certainly become increasingly important for communications. For my internet connection, I am likely to ditch BT for Starlink, and I doubt I am alone.”

Moreover, we noted that it traded on a wide discount to NAV.

“According to their factsheet, the net asset value is 96.18p per share while the shares trade at 59.2p. Therefore, SSIT trades on a 38% discount to NAV, or 62% upside, to reach fair value.”

A year and a half later, it is SpaceX IPO day, the largest fundraise in capital markets history. The SSIT NAV has risen to 177.6p, up nearly 2x in the year and a half since we bought in. The share price reached a peak of 277p, meaning its 38% discount had swung to a premium of 56%. At its price today of 216p, that premium remains material at 22%.

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This has been driven largely in the last six months. The fair value of their portfolio, which stood at £332m in December 2025, reached £432m in June 2026, a 30% gain in six months. The trust contains a number of high-growth, high-tech, high-beta stocks, which have been in vogue in the first half of 2026.

SSIT vs Semiconductor, Momentum, and Magnificent 7 Stocks

Source: Bloomberg

SSIT has risen sharply in the last six months, as space, like some clean energy sectors, has joined the high-risk rally led by semiconductors. Its performance raced ahead of even semiconductors, which have been the headline act of this rally from the media’s perspective. We are happy to have owned something even stronger.

The IPO of Starlink’s owner is a natural endpoint for this hype cycle and for our holding of the trust. Two old bits of investing wisdom are relevant here. From an IPO perspective, “the first print is often the best print” was a favoured quote from an old IPO analyst friend, meaning that a good first day is often as good as it gets. Meanwhile, “Buy the rumour, sell the news” has rarely seemed more relevant than with the SpaceX IPO.

A huge amount of spin has gone into pushing this onto Wall St and Main St alike, with Goldman Sachs claiming 100x revenue growth by 2030, to justify its bewilderingly lofty valuation. Online Brokers have been spamming their clients with incitements to get involved for days. Index providers have changed their rules to accommodate it, for fear of losing business to their rivals, which is reminiscent of the ratings agencies handing out triple-A ratings to keep clients in 2007. Even today’s surge in market optimism was driven by claims of a US-Iran deal, largely communicated through… X (Twitter), which is now part of SpaceX.

As for SSIT, it received a further boost in recent weeks with the announcement that it would join the FTSE 250 index. At the same time, it sensibly issued shares in May once they moved to a premium.

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