Scottish mortgage loan (LSE: SMT) shares have been seeing more interest lately following news of a potential SpaceX IPO. But there is no guarantee that this movement will be pristine and immediate.

The trust has a huge stake in Elon Musk’s space exploration company and if the market accepts a much richer IPO valuation, it could augment the net asset value.

However, taking a closer look at the numbers, it may turn out that not everything will go as smoothly as some expect.

Why it matters now

Scottish Mortgage sold a whopping 1.7 million of its own shares on May 18, showing just how much the IPO is affecting confidence. It also currently values ​​its stake in SpaceX at $1.25 trillion and says it was 19.3% of total assets as of March 31.

The latest market chatter suggests that SpaceX may be listed on the stock exchange Nasdaq under the SPCX ticker on June 12. Given a valuation of $1.75 trillion, it would be the largest IPO in history.

So the first question is elementary: Will the IPO price be evidence that the trust was too cautious or too sanguine?

Why SpaceX shares may fall

SpaceX has finally released its financials ahead of its IPO, and the numbers aren’t pretty.

According to reports, in 2025, the group lost $4.94 billion on revenue of $18.67 billion, while in the first quarter of 2026, losses amounted to $4.3 billion on sales of $4.7 billion.

Starlink remains the main breadwinner, reaching $11.38 billion in revenue in 2025. However, the broader business continues to be hampered by massive spending, particularly on data center infrastructure for xAI.

That’s why it’s critical for investors to approach this as a classic “growth at all costs” story:

• Strong revenue growth but huge cash losses.
• Starlink is making money, other divisions are still losing heavily.
• Artificial intelligence and space infrastructure may prevail later, but are currently steep.

And that leads to an uncomfortable question: What happens if the market decides the dream is too steep?

Pros and cons of a Scottish mortgage

In the case of Scottish Mortgage, the advantages are obvious. A successful $1.75 trillion IPO would add value to a holding company already worth $1.25 trillion, increasing the trust’s overall net asset value (NAV).

But the disadvantage is also obvious. This is already a technologically advanced fund, with a significant concentration in the USA. This means that any disruption in the US technology market could lead to a piercing decline in stock prices.

Fortunately, this risk is somewhat mitigated by more diverse names such as TSMC, ASML, Ferrari AND MercadoLibre. However, investors still need to rely on fund managers to make good portfolio decisions allocation.

Here’s a elementary trade-off of pros and cons:

Final thoughts

The SpaceX IPO is likely to be one of the biggest stock market events in history, but it could go either way.

But because the Scottish mortgage is very high variedI’m sure it will survive any outcome. Still, investors considering buying shares should do so with an understanding of the potential for near-term volatility if something goes wrong.

It is worth noting that over the last 10 years, the share price has increased by 496.6%, representing a compound compound growth rate (CAGR) of 19.7%.

If this record can be maintained, the next decade could be very lucrative.

Should you invest £5,000 in Scottish Mortgage Investment Trust Plc now?

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Mark Hartley owns shares in the Scottish Mortgage Investment Fund.