Index provider S&P Dow Jones Indices has announced it will uphold the current eligibility criteria for its major benchmark indices, such as the S&P 500, rejecting proposals to fast-track the inclusion of newly public mega-cap companies like Space Exploration Technologies Corp.

In a Thursday press release, the firm stated it will not shorten the existing 12-month observation period for new listings, nor will it waive current requirements for profitability and public float based on company size. This stance sets it apart from competitors like Nasdaq and FTSE Russell.

This decision comes as Wall Street grapples with a new reality where some companies reach unprecedented scale before going public. Earlier this year, S&P Dow Jones sought public feedback on whether index rules, designed for a different era, should be adjusted to accommodate firms that now achieve sizes once typical only for mature blue-chips—a concept known as the "fast track."

The proposal to accelerate inclusion into benchmarks raised concerns among some investors. They argue that rules regarding profitability, share float, and trading history exist precisely to prevent indices from blindly chasing market hype. Furthermore, they contend that adding IPO companies too quickly could expose passive funds to greater market volatility, forcing them to buy shares before reliable market pricing is fully established.

On the other hand, proponents argue that indices should incorporate large companies swiftly to reflect the actual market investors participate in. They note that these trillion-dollar companies may already hold significant economic importance long before they meet traditional index requirements.

This ruling means Space Exploration Technologies Corp would need to be publicly traded for at least one year before being considered for the S&P 500. Additionally, the company would still need to meet the index's profitability and public float criteria.

"This decision surprised me," said Bloomberg Intelligence ETF analyst James Seyffart. "But S&P is the market leader and can afford to go its own way."

In contrast, Nasdaq recently amended its rules, allowing a company like Space Exploration Technologies Corp to join the Nasdaq 100 index after just 15 trading days, compared to a previous minimum of three months. FTSE Russell has also adopted a similar approach, reducing its waiting period to five trading days.