Subversive Markets Lab LLC filed with the US Securities and Exchange Commission (SEC) to launch two exchange-traded funds (ETFs) designed to track major indices while excluding companies associated with Elon Musk. The proposed Subversive Nasdaq-100 Ex-Elon Enterprises ETF (QQNE) and Subversive S&P 500 Ex-Elon Enterprises ETF (SPNE) aim to provide broad US equity exposure without the risks linked to Musk-led enterprises. The funds target investors seeking to avoid corporate governance concerns, political risks, and heightened share-price volatility identified with such companies.

The initial exclusion list includes Tesla Inc and Space Exploration Technologies Corp. The funds will redistribute the index weight of these excluded companies across the remaining constituents of the Nasdaq-100 and S&P 500. Other entities controlled by Musk, such as Neuralink and The Boring Company, are privately held and will not be included in the funds.

Fund Mechanics and Holdings

QQNE and SPNE will gain exposure through direct stock holdings, other ETFs, or derivatives. To maintain compliance with their investment mandates, the funds will periodically review holdings. QQNE will sell any holding once it is removed from the Nasdaq-100 and will not own any index constituent that meets its "excluded enterprises" criteria. SPNE will follow the same approach for companies within the S&P 500.

The review process ensures that companies which later become controlled or led by Musk are excluded, while newly eligible index constituents can be added to the portfolio.

Market Context

The filing follows Space Exploration Technologies Corp's entry into the Nasdaq-100. This inclusion increased passive investors' exposure to Musk-controlled companies, as millions of investors holding index funds and ETFs now indirectly own the aerospace stock.