SpaceX now swings between 4 and 9% of the portfolio, forcing new risk parameters
A US$60m commitment to SpaceX made roughly eight years ago is now worth about US$2bn, leaving the Orange County Employees Retirement System with a position far more concentrated than it underwrote.
Chief investment officer Molly Murphy told Bloomberg the California plan built the stake across two funding rounds, through co-investments with venture capital managers already in the portfolio.
SpaceX went public on June 12, according to Bloomberg, climbing to about US$225 per share before dropping as low as US$104.83.
The stock now trades near US$136.20.
Those swings have moved SpaceX between 4 and 9 percent of the OCERS portfolio since the listing, Murphy said.
The Magnificent 7 stocks and Broadcom Corp each hold a steadier 1 percent of the public equity book, she told Bloomberg.
"We believe that we're buying generational holdings, but living with SpaceX month to month, quarter to quarter is going to be interesting," Murphy said in an interview with Bloomberg.
The plan will adopt different risk parameters for the holding.
"SpaceX will be a very concentrated position for a very long time for the pension," Murphy told Bloomberg.
She said a doubling from here would be a tame expectation over five years, and that the pension has to weigh volatility in the stock as well as concentration risk.
The original thesis was regional and infrastructural.
OCERS invested as part of an effort to become a bigger participant in California's economy, Murphy said, at a time when SpaceX's plants sat in the state.
The plan was underwriting "the promise" of Starlink Inc, SpaceX's satellite internet service.
Murphy told Bloomberg the pension was investing in a next-generation communications company, with the rocket business and its Department of Defense contracts serving as collateral.
The plan's venture capital holdings are now "exploding because of these big wins" and exceed their target size, Murphy said, adding that OCERS holds other artificial intelligence-related ventures she declined to name.
Bloomberg reported the plan will shift SpaceX into its public markets asset class in the near future to rebalance the venture book.
Murphy said the pension expects to hold the position for as long as it believes in the company.
She tied that belief to Elon Musk's longevity "in some way, shape or form."
Other funds carrying the same position
Ontario Teachers' Pension Plan carries the same concentration on a larger base.
Its SpaceX stake stood at about US$8.7bn on June 30, according to a US Securities and Exchange Commission filing reported by the Globe and Mail, against roughly $300m committed through its venture arm in 2019.
The plan's venture growth portfolio grew from $15.3bn to $25.9bn over the first half and now sits at 9 percent of total assets, up from 6 percent in December, per Teachers' mid-year results.
Teachers' reported a 9.5 percent net return and $26.6bn in net investment income for the six months to June 30, with net assets of $303.2bn.
The Globe and Mail put the stake closer to US$7bn at the share price in the days after the mid-year mark, before recent share sales.
Norway's Government Pension Fund Global disclosed a SpaceX position for the first time in August, CNBC reported, valued at about US$1.2bn.
The fund manages roughly US$2.34tn and holds stakes in more than 7,000 companies, which keeps the SpaceX exposure immaterial against holdings such as its 1.3 percent of Nvidia, worth about US$61.8bn as of June 30.
Norges Bank Investment Management has separately put key-person risk on the record where Musk is concerned.
In opposing Musk's pay package at Tesla's late-2025 annual meeting, the manager cited the size of the award, dilution, and the absence of any mitigation for key-person risk, according to CNBC.
IPE reported in June that most asset owners approached the SpaceX IPO carefully, describing the decision as a question of faith or discipline.
Pensions & Investments reported the same week that some pension fund executives raised governance and valuation concerns as index-driven buying loomed.
