Soaked up $1.3 billion in a single month! SpaceX’s potential IPO ignites Wall Street, with U.S. space-themed ETFs being snapped up like crazy.

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The anticipated SpaceX IPO is expected to ignite market enthusiasm and drive explosive growth in space-themed ETFs, but concerns about high portfolio overlap are also emerging.

According to Morningstar Direct data, U.S. space-related ETFs attracted $1.3 billion in new capital over the past month, bringing the sector’s total assets under management to $3.3 billion.

The core driving force behind this surge in funds is the IPO signal released by Elon Musk's SpaceX for 2026.

New product launches are accelerating in tandem. In just the past three months, six new space-themed ETFs have been added to the market, with another two products expected to launch around the time SpaceX is anticipated to list in mid-June. Some issuers have also filed for leveraged and enhanced yield ETFs directly linked to SpaceX with the U.S. Securities and Exchange Commission (SEC). However, analysts warn that the existing space-themed ETFs have over 50% portfolio overlap, and investors should beware the structural risks behind the hype.

Space ETF Assets Expanding Rapidly

Previously, investors seeking to focus on the space economy through ETFs—rather than the broader aerospace and defense sector—had only one option for several years: Procure Space ETF, founded in 2019.

However, since SpaceX began signaling its IPO intentions to the market in the past three months, the landscape shifted quickly, with six new funds emerging in succession.

Among them, the $1.27 billion Tema Space Innovators ETF stands out—having accumulated more assets in just seven weeks since its launch than UFO has gathered in its seven years, totaling $972 million.

Morningstar ETF analyst Bryan Armour characterizes this phenomenon as the market’s usual reaction to emerging buzz: "Whenever something fresh and shiny appears in the market, we tend to see this happen."

New Issuances Continue, Leveraged Products Ready to Launch

The latest wave of product launches is far from over.

Two more space-themed ETFs are expected to go live in the weeks around the SpaceX IPO. Meanwhile, some issuers have filed with the SEC to launch leveraged ETFs and enhanced yield products directly linked to SpaceX.

Two of the newest entrants—the VanEck Space ETF and Corgi Space and Satellite Communications ETF—launched one day apart in early May, together attracting $13.6 million in assets.

VanEck product manager Nick Frasse said the company has long watched this space, but only in recent months judged the market to have reached a real tipping point—"There are now enough diversified and pure space economy companies to truly support the operation of thematic ETFs like these."

He also noted that SpaceX’s IPO will bring more related enterprises into the space economic ecosystem.

Not Just SpaceX—Space Stocks Taking Off Early

Although SpaceX is now the core of the market narrative, ETF managers emphasize that the investment logic of the space economy has long surpassed mere anticipation for a single IPO.

Rocket Lab and AST SpaceMobile have surged 393% and 258%, respectively, in the past twelve months, showing strong performance even before SpaceX is formally listed.

Procure CEO Andrew Chanin notes that two-thirds of UFO’s fund inflows have occurred in the past twelve months, with 20% concentrated in the most recent month.

He recalls that when the fund was founded in 2019, it was rated "worst ETF launch of the year" by Morningstar, but Morningstar data now shows it has delivered a 49% return this year and soared 133.6% over the past year.

Chanin positions the space economy as a "toll booth on the AI superhighway," believing that as satellites and orbital data centers play key roles in the next stage of the communications revolution, the strategic value of the space economy will continue to emerge.

High Portfolio Overlap—Analysts Warn of Structural Risks

Amid the frenzy, risks cannot be ignored. Strategas ETF strategist Todd Sohn warns that the chase for SpaceX, space concepts, and the next big story may harbor hidden dangers.

Reuters’ analysis of the largest holdings in the seven existing pure space-themed ETFs shows that all funds have the same four stocks in their top ten holdings (including Rocket Lab), and the portfolio overlap among funds is over 50%.

"When everyone is thinking the same way, I start to worry," Sohn says. "It makes it hard for any individual fund manager or product to really differentiate—ultimately, it's just marketing that sets them apart."

He also noted that the space economy is still a very small niche within the broader tech landscape, and recent standout performance should not blind investors to its structural limitations.

Risk Warning and DisclaimerThe market has risks, and investments should be made cautiously. This article does not constitute personal investment advice and does not take individual users' specific investment objectives, financial situations, or needs into account. Readers should consider whether any opinions, viewpoints, or conclusions in this article suit their own circumstances. Investments based on this are at your own risk. ```