Vanguard, Rigetti, and the Illusion of Endorsement

Quantum Stocks

It has come to our attention – and, no doubt, to yours, dear reader, if you’ve been following the financial circuses – that certain headlines have been proclaiming Wall Street’s fondness for Rigetti Computing. A veritable stampede, they suggest. The usual suspects – Vanguard, BlackRock, State Street – are accumulating shares, the papers declare. A grand endorsement, naturally. One might almost believe these titans of finance possess a crystal ball, or at least a particularly astute astrologer. But let us, as always, apply a touch of healthy skepticism, a pinch of common sense, and a generous helping of observation. After all, the road to ruin is paved with good intentions, and shareholder lists.

Vanguard, it seems, holds a substantial position in Rigetti – roughly $577 million worth. A princely sum, one might say. But before you rush to emulate their brilliance, consider this: Vanguard doesn’t so much choose stocks as collect them. It’s a bit like a diligent bureaucrat accumulating stamps – not out of passion, but out of obligation. The stock, you see, is a component of the Russell 2000 index. Vanguard’s passively managed funds – those marvels of modern finance that promise to mimic the market, rather than beat it – are compelled to hold every stock in that index, in proportion to its weighting. A mechanical process, devoid of sentiment, conviction, or even a flicker of independent thought. It’s a bit like being forced to attend a particularly tedious banquet – one consumes what is served, regardless of taste.

When Rigetti’s stock price experienced a surge – a rather exuberant leap, actually, exceeding 1,700% – its weighting in these indexes increased accordingly. Vanguard’s stake grew, naturally, as did its presence in those funds’ portfolios. It’s a simple matter of arithmetic, not a stroke of genius. The same principle applies to BlackRock, State Street, and the other grand custodians of capital. They are not making bets; they are simply following instructions. It’s a bit like a well-trained dog performing tricks – impressive, perhaps, but hardly indicative of profound intelligence.

Now, there are exceptions, of course. A few active hedge funds – D.E. Shaw among them – also hold positions in Rigetti. But let us not be misled. These are not long-term investments based on fundamental analysis. D.E. Shaw, you see, is a “quant” fund – a den of algorithms and statistical models. They trade on momentum and other fleeting indicators, with the cold detachment of a calculating machine. It’s a bit like a gambler chasing a lucky streak – irrational, perhaps, but undeniably profitable – at least until the streak ends. They aren’t interested in the future of quantum computing; they’re interested in exploiting short-term price fluctuations.

Vanguard Passive Rigetti

The funds that genuinely intend to hold stocks for the medium to long term – those bastions of patient capital – maintain minuscule positions in Rigetti – less than 0.01% of their portfolios. Rounding errors, one might say. It’s a bit like adding a single drop of water to the ocean – noticeable, perhaps, but ultimately insignificant. They are not sending a signal; they are merely tidying up their portfolios.

Institutional ownership data, dear reader, is a notoriously unreliable indicator. A name like Vanguard on a shareholder list feels like validation, but it is, in most cases, an illusion. It’s a mechanical consequence of index inclusion, not a reflection of “smart money” loving Rigetti. It’s a bit like mistaking a shadow for a substance. A charming deception, perhaps, but a deception nonetheless.

So, should you buy Rigetti stock? That, my friend, is a question best answered by your own conscience – and your tolerance for risk. We wouldn’t dream of offering financial advice. But let us simply observe that the road to potential success for Rigetti and other quantum computing ventures will be long – much longer than many of the industry’s more enthusiastic proponents believe. If we are right, the risks are considerable – existential, even. A sobering thought, perhaps, but one worth considering before parting with your hard-earned capital. After all, fortune favors the cautious – and the slightly cynical.

2026-02-21 18:52

Read More