A SpaceX Falcon 9 rocket carrying a payload of Starlink v2-mini satellites lifts off at the U.S. Space Force Station in Cape Canaveral, Fla., in June, 2025.Steve Nesius/Reuters
For Canadians thinking about new frontiers of investing, the impending IPO of SpaceX might suggest that the sky is no longer the limit.
SpaceX’s numbers have raised eyebrows – the prospectus touted what it called “the largest actionable total addressable market in human history,” of US$28.5-trillion – but analysts acknowledge that the space sector has significant room to grow. The World Economic Forum and McKinsey & Co. have forecast the global space economy to expand to US$1.8-trillion by 2035, from US$630-billion in 2023.
The potential of the world’s largest-ever initial public offering may be attracting all the attention, but Canadian investors can find opportunities elsewhere in the sector and closer to home, supported by more immediate, terrestrial concerns. While the potential rewards are significant, so are the risks in a sector that’s just getting off the ground.
“It’s an economy that’s really just beginning, you don’t know where it’s going to go, you don’t really know who the winners are going to be and what the ultimate applications are going to be,” said Chris McHaney, executive vice-president of investment management and strategy at Global X Investments Canada.
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Some clues, however, may lie in the federal government’s Defence Industrial Strategy, released in February, which listed space as one of 10 key areas of sovereign capability.
The strategy constitutes not just a defence policy, but a “material economic gameplan” with potential to boost domestic champions, according to a report by analysts at Stifel Nicolaus and Co.
Those champions, which will be selected through a framework that Ottawa says will be published by this summer, will be the beneficiaries of preferential procurement, export promotion, and research and development funding and infrastructure. In exchange, they will need to invest in Canada and maintain intellectual property and manufacturing here.
“We don’t think it’s extreme to say that a complete long-term reshaping of the Canadian economy is being executed via these companies,” the Stifel Nicolaus analysts said.
MDA Space Ltd. (MDA-T) is seen as a likely candidate for inclusion. The company, based in Brampton, Ont., and known for making the robotic arm on the International Space Station, recently raised more than US$340-million in an IPO on the New York Stock Exchange. In its 2025 earnings presentation ahead of the IPO, the company highlighted record revenues, order bookings of $1.2-billion, a backlog of $4-billion and a $40-billion pipeline of opportunities.
Thanos Moschopoulos, an analyst at BMO Capital Markets, said in a note that the “robust backlog and pipeline” would help to drive sustained growth, highlighting governments’ increasing urgency and willingness to spend on “sovereign space infrastructure.”
At the same time, Mr. Moschopoulos noted a potential downside for MDA’s shares if large satellite or defence contracts don’t pan out. A significant proportion of its revenues comes from government programs that face risks of changing budgets and priorities, he said.
Investors eager for a piece of the space economy have nevertheless helped to fuel sharp rises in the sector this year, leaving the 9- to 10-per-cent gains of the S&P 500 and S&P/TSX Composite indexes far behind.
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The S&P Kensho Space Index, a U.S. index intended to represent companies focused on the commercialization and exploration of space, has gained nearly 54 per cent since January. In a little over a month since Global X launched its Space Tech exchange-traded fund (ORBX-T) – the first Canadian ETF focused on the space sector – it has jumped close to 60 per cent.
Not all space-related investments have lifted off, however, including some offering exposure to private SpaceX shares. The Baron First Principles ETF (RONB-N), which allocates about 8 per cent of its assets to SpaceX, has lagged even the broader market, slipping around 4.5 per cent since January.
Despite the short-term volatility, Mr. McHaney said that an investment in space could play a role in investors’ portfolios as a hedge against rising global instability. More government spending on domestic champions in Canada and elsewhere is indicative of a trend of countries that had once relied on the United States for security seeking greater self-sufficiency, he said.
The International Institute for Strategic Studies put global defence spending at US$2.63-trillion in 2025, a 6-per-cent increase from a year earlier. Canada has committed to increasing its total spending on defence and security-related investments to 5 per cent of GDP by 2035, in line with a North Atlantic Treaty Organization target.
“It really does play into this geopolitical risk that’s kind of omnipresent right now. I won’t equate it to an allocation to gold, but it is a similar sort of concept,” Mr. McHaney said.