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There’s now an ETF for people who want broad market exposure but would rather not bet on anything Elon Musk touches. Two new funds filed with the SEC aim to replicate the Nasdaq-100 and S&P 500, minus Tesla and SpaceX.
Subversive ETFs, operating under the Tidal Trust I structure, submitted post-effective amendment No. 324 on July 8 to launch the Nasdaq-100 Ex-Elon Enterprises ETF (ticker: QQNE) and the S&P 500 Ex-Elon Enterprises ETF (ticker: SPNE). Both funds are scheduled to begin trading on September 21.
What these funds actually do
The mechanics are straightforward. Both ETFs will maintain at least 80% of their assets in their respective index exposures, but with one notable exception: any company associated with Elon Musk gets cut from the portfolio.
The initial exclusions target Tesla (TSLA) and SpaceX (SPCX). When those companies get removed, their weight in the index doesn’t just disappear. It gets reallocated across the remaining holdings based on market capitalization.
Both funds are actively managed, which is worth noting. Traditional index funds that passively track the S&P 500 or Nasdaq-100 tend to charge rock-bottom fees. Active management typically means higher expense ratios, though specific fee structures for QQNE and SPNE haven’t been confirmed yet.
Subversive ETFs has built its brand around culturally aligned investment products. The firm has a track record of launching thematic ETFs that reflect ideological or values-based preferences, making these filings consistent with its broader strategy.
Why this is happening now
The timing isn’t random. SpaceX’s inclusion in the Nasdaq-100 changed the calculus for passive investors who track that index. Before that inclusion, an investor who wanted to avoid Musk exposure in a Nasdaq-100 fund only had to worry about Tesla. Now there are two Musk-linked companies sitting in one of the most widely tracked indexes in global markets.
This fits into a broader trend that’s been building for years. Thematic exclusion ETFs, where funds are built around removing specific companies, sectors, or categories, have been growing as investors increasingly treat their portfolios as expressions of personal values. Previous attempts at Musk-exclusion products, like the now-defunct Battleshares ELON ETF, reveal that while thematic exclusions may attract interest, their long-term viability and market performance remain uncertain.
What this means for investors
The core tension with these products is straightforward. If Tesla and SpaceX outperform the broader market, QQNE and SPNE will lag their parent indexes. Investors choosing these funds are effectively making a bet, or at least accepting a trade-off, that whatever they gain from avoiding Musk-linked risk is worth the potential performance drag.
The active management component adds another layer of consideration. Passive index funds have dominated flows for years precisely because they’re cheap and predictable. An actively managed exclusion fund needs to justify its presumably higher fees, and the primary justification here is the exclusion itself rather than stock-picking alpha.
Investors watching this space should pay close attention to the expense ratios when they’re finalized, the tracking difference relative to the unmodified indexes, and most critically, whether the funds can attract enough assets to remain viable. Thin trading volumes in niche ETFs can create their own problems, including wider bid-ask spreads that effectively act as hidden costs on top of the management fee.
Disclosure: This article was edited by Editorial Team. For more information on how we create and review content, see our Editorial Policy.
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