Should I Buy The Destiny Tech 100 Fund for A 35% Exposure To SpaceX? Or Do I Prefer Another Stock?

Beat The Denominator
11 Apr 202406:03

TLDRThe video discusses the Destiny Tech 100 Fund (DXYZ) and its 34% exposure to SpaceX, highlighting the high premium it offers for this exposure. The speaker suggests considering stocks like Google, which owns 6.99% of SpaceX, as a more cost-effective way to gain indirect exposure to SpaceX. The video emphasizes the potential long-term growth of SpaceX and the value of having a diversified investment strategy.

Takeaways

  • 🚀 The Destiny Tech 100 Fund (DXYZ) has been trending due to its 34% exposure to SpaceX.
  • 📈 DXYZ's value has fluctuated, reaching a high of $1.2 billion in trading but has since dropped to $500 million market cap.
  • 💰 The fund owns $15.4 million in SpaceX, which represents 34% of its assets according to the latest update.
  • 📊 Investing in DXYZ for SpaceX exposure is expensive, with a 14x premium on the value of SpaceX's shares within the fund.
  • 🌟 The long-term potential of SpaceX is acknowledged, but the growth to match the current valuation may take a considerable amount of time.
  • 🔍 Alternative investment options are suggested, such as stocks with indirect exposure to SpaceX like Google, which owns 6.99% of SpaceX.
  • 📱 Google is presented as a 'savings account stock' with steady growth potential, plus the added benefit of SpaceX ownership.
  • 💹 Google's valuation is linked to SpaceX, offering a more affordable way to gain exposure to the space company.
  • 📊 The public valuation of SpaceX through DXYZ is higher than the private valuation, indicating a significant premium.
  • 🤔 The decision to invest should be based on an individual's risk tolerance and investment horizon.
  • 🎮 The video content is for entertainment purposes and should not be considered as financial advice.

Q & A

  • What is the Destiny Tech 100 Fund and how is it related to SpaceX?

    -The Destiny Tech 100 Fund, symbolized by DXYZ, is an investment fund that has gained attention due to its significant ownership in SpaceX, approximately 34%. This connection has contributed to the fund's popularity and value fluctuations.

  • How has the value of the Destiny Tech 100 Fund changed over time?

    -The Destiny Tech 100 Fund's value has experienced fluctuations, trading as high as $1.2 billion or near $100 a share, but has since dropped to around $50 a share.

  • What is the current holding of the Destiny Tech 100 Fund in SpaceX?

    -As of the latest update, the Destiny Tech 100 Fund holds $15.4 million worth of SpaceX shares.

  • What is the implied valuation of SpaceX based on the Destiny Tech 100 Fund's market cap?

    -Based on the fund's market cap of $609 million and the 34% exposure to SpaceX, the implied valuation of SpaceX is approximately $211 million for the $15 million held by the fund, indicating a 14x premium.

  • Why might an investor consider Google as an alternative to the Destiny Tech 100 Fund for SpaceX exposure?

    -Google, through its subsidiary Google Ventures, owns 6.99% of SpaceX. Investing in Google provides indirect exposure to SpaceX at a potentially lower cost compared to investing in the Destiny Tech 100 Fund.

  • What is the private valuation of SpaceX based on Google's ownership stake?

    -With Google owning 6.99% of SpaceX, and the private valuation of SpaceX being $180 billion, Google's stake is worth approximately $12.5 billion.

  • How does the public valuation of SpaceX compare to its private valuation through the Destiny Tech 100 Fund?

    -The public valuation of SpaceX, as reflected in the Destiny Tech 100 Fund, can be significantly higher than the private valuation. At one point, the fund indicated a valuation of up to $350 billion for SpaceX, which is much higher than the $180 billion private valuation.

  • What is the long-term investment perspective on SpaceX as discussed in the script?

    -The script suggests that while SpaceX has great potential for growth over the long term, it might take a lengthy process for the company to reach the high valuations seen in the public market, especially through investments like the Destiny Tech 100 Fund.

  • How does the speaker view Google as an investment?

    -The speaker views Google as a safe investment similar to a savings account, but with additional growth potential due to its ownership in SpaceX. The speaker expects Google to perform steadily, with potential annual returns similar to the NASDAQ's historical performance.

  • What percentage of an investment in Google goes towards SpaceX?

    -For every dollar invested in Google, approximately 7% indirectly goes towards SpaceX, based on Google's 6.99% ownership stake in the company.

  • What is the speaker's perspective on the potential future of Google's stake in SpaceX?

    -The speaker speculates that Google may increase their stake in SpaceX in the future, which could provide additional value to Google investors through increased exposure to SpaceX.

Outlines

00:00

🚀 Discussing the Destiny Tech 100 Fund and SpaceX Exposure

The first paragraph discusses the Destiny Tech 100 fund (DXYZ) and its association with SpaceX. The speaker highlights the fund's recent popularity and its trading value, which once reached $1.2 billion. The focus is on the fund's 34% ownership in SpaceX and the cost of obtaining exposure to SpaceX through DXYZ. The speaker points out that despite the high expense, there is potential for growth over a long period, but they prefer an alternative stock for SpaceX exposure. The paragraph concludes with a mention of Destiny Tech's $15.4 million investment in SpaceX and the fund's market cap of $609 million, emphasizing the premium paid for the SpaceX stake.

05:00

🌟 Google's Stakes in SpaceX as an Investment Strategy

The second paragraph shifts focus to Google's 6.99% ownership in SpaceX and how it can be a more accessible and safer way for investors to gain exposure to SpaceX. The speaker likens Google to a 'savings account stock' due to its steady performance and potential growth aligned with NASDAQ. They provide a calculation showing that for the private valuation of SpaceX at $180 billion, Google's stake is worth $12.5 billion. However, based on the Destiny Tech 100 fund's valuation, Google's stake in SpaceX is worth $175 billion. The speaker suggests that investing in Google not only provides a stable return but also a 'spiced-up' exposure to SpaceX. The paragraph ends with a reminder that this content is for entertainment and not financial advice.

Mindmap

Keywords

💡Destiny Tech 100 Fund

The Destiny Tech 100 Fund, also known as DXYZ, is a closed-end fund that has been trending and gaining attention due to its significant exposure to SpaceX. In the video, it is mentioned that the fund owns 34% of SpaceX, making it an attractive option for investors seeking exposure to the space exploration company. However, the speaker points out that this exposure comes at a high cost, as the fund's valuation multiples the value of its SpaceX holdings, resulting in a premium for investors.

💡SpaceX

SpaceX, or Space Exploration Technologies Corp., is a private aerospace manufacturer and space transportation company founded by Elon Musk. It has been at the forefront of space technology, with ambitious projects like the Starship and Mars colonization. In the context of the video, SpaceX's valuation and its ownership by the Destiny Tech 100 Fund are central to the discussion, as the fund provides a way for the public to indirectly invest in SpaceX, despite it being a private company.

💡Investment

Investment refers to the act of committing money, time, or other resources to a particular venture with the expectation of achieving a profit or return. In the video, the speaker is considering different investment options related to SpaceX, weighing the pros and cons of investing in the Destiny Tech 100 Fund versus other stocks that have exposure to SpaceX.

💡Valuation

Valuation is the process of determining the economic value of an asset or company, often based on financial analysis. In the context of the video, the valuation of SpaceX and the Destiny Tech 100 Fund are crucial for understanding the potential return on investment. The speaker calculates the implied valuation of SpaceX based on the fund's market cap and its holdings in SpaceX, highlighting the premium that investors are paying.

💡Google

Google, now a subsidiary of Alphabet Inc., is a multinational technology company that specializes in Internet-related services and products. In the video, Google is presented as an alternative investment to the Destiny Tech 100 Fund because it owns a 6.99% stake in SpaceX. This provides investors with indirect exposure to SpaceX at a potentially lower cost than investing in the Destiny Tech 100 Fund.

💡NASDAQ

The NASDAQ, or the National Association of Securities Dealers Automated Quotations, is an American stock exchange that hosts the trading of several major technology companies. It is often used as a benchmark for technology stocks and the overall performance of the tech sector. In the video, the speaker suggests that Google's performance will be similar to the NASDAQ, providing a steady return on investment with the added benefit of its SpaceX stake.

💡Closed-End Fund

A closed-end fund is a type of investment fund that issues a fixed number of shares to investors and then those shares are traded on a secondary market like a stock. Unlike open-end funds, closed-end funds do not issue or redeem shares directly; instead, their shares are bought and sold between investors at market-determined prices. The Destiny Tech 100 Fund is an example of a closed-end fund, and its market value can fluctuate above or below its net asset value (NAV).

💡Net Asset Value (NAV)

Net Asset Value, or NAV, refers to the per-share value of a closed-end fund, calculated by subtracting its liabilities from its total assets. It represents the amount that would be left for each shareholder if a fund were liquidated. In the video, the speaker references the NAV of the Destiny Tech 100 Fund to analyze its exposure to SpaceX and to compare it with the market price of the fund's shares.

💡Premium

In the context of investing, a premium refers to the additional amount that investors are willing to pay above the nominal or intrinsic value of a security. In the video, the term is used to describe the high cost of obtaining exposure to SpaceX through the Destiny Tech 100 Fund, as the market price of the fund's shares is significantly higher than the value of its SpaceX holdings.

💡Long-term Investment

A long-term investment is an investment that an investor intends to hold for an extended period, typically more than a year. The goal of long-term investments is usually to achieve significant returns through the growth and appreciation of the asset over time. In the video, the speaker considers the potential for SpaceX's valuation to grow into the premium offered by the Destiny Tech 100 Fund over a long-term horizon.

💡Stake

A stake in a company refers to a portion of ownership or a share of equity held by an investor or another company. In the context of the video, the term is used to describe the ownership interest that the Destiny Tech 100 Fund and Google have in SpaceX. The size of the stake influences the level of exposure that investors in these entities have to the space company.

Highlights

The Destiny Tech 100 Fund (DXYZ) has been trending and is known for its exposure to SpaceX.

DXYZ traded up to $1.2 billion and was trading near $100 a share before dropping to $50 a share.

The fund owns 34% of SpaceX, which is a significant part of its value.

The speaker suggests that investing in DXYZ is an expensive way to get exposure to SpaceX.

Destiny 100 Tech owns $15.4 million USD in SpaceX according to the latest fund update.

The market cap of DXYZ is currently $609 million.

Investors are effectively paying $211 million for $15 million of SpaceX through DXYZ.

The 34% exposure to SpaceX through DXYZ comes at a 14x premium.

Google owns 6.99% of SpaceX, providing another way to get exposure to the company.

Google's ownership of SpaceX is considered a 'savings account stock' with added benefits.

Google is viewed as a steady, reliable investment with potential long-term growth due to its SpaceX stake.

The private valuation of SpaceX is $180 billion, with Google owning $12.5 billion worth at current valuation.

At the public price of DXYZ, Google effectively owns $175 billion worth of SpaceX.

Investing in Google provides exposure to SpaceX at a significant discount compared to DXYZ.

For every dollar invested in Google, approximately 7% goes towards SpaceX.

The speaker expresses hesitation to sell Google due to its SpaceX stake, despite its slower growth.

The video emphasizes long-term investment strategies and not immediate financial gains.

The content is for entertainment purposes only and should not be taken as financial advice.

Casual Browsing

Should Investors Buy AMD Stock on the Dip? | AMD Stock Analysis

2024-04-16 18:20:01

TEMU Tech haul, i was SHOCKED! Bargain or for the Bin?

2024-03-29 22:30:00

IM CLEANING UP CRIME SCENES FOR THE MAFIA & I BETTER DO A GOOD JOB OR IM NEXT

2024-04-09 02:10:01

I Had to Buy Scaffolding

2024-04-02 12:40:01

Am I Talking to AI or A HUMAN?!

2024-05-16 21:10:02

If I Take Damage I Have To Buy Weird Minecraft Merch...

2024-04-14 19:30:01