Facebook, Inc. (NASDAQ: FB) had two big milestones today while its totally-in-control CEO decided to mix a honeymoon in while his newly public shares are in free-fall. The stock broke under $30.00 and it saw explosive options trading on the first real trading day of those options. Shares are down almost another 8% at $29.40 on about 45 million shares as of 1:10 PM EST. The stock is down well over 20% from the IPO price of $38 but it is getting to be down closer to 30% from the post-IPO trading session highs.
The more interesting trading action is in the options rather than the stock. The implied volatility is put at roughly 60% and this is the most active ever for an options debut. Total contract volume is over 100,000 contracts.
We have seen a push and pull here as there have been over 6,000 of the June-2012 $30 CALLS. The June PUTS with a $28 strike have seen almost 8,000 contracts trade hands and almost 7,000 contracts of the $29 strike price.
Even the July expiration has seen over 7,400 contracts trade in the $25 strike price.
The August $27 PUTS have seen over 1,200 contracts trade.
Interestingly enough, we have not seen any of the longer dated LEAPs trade in size as none of the strike prices in the JAN-2013 and JAN-2014 contract expirations have even seen 1,000 contracts trade.
What is interesting is that this now allows investors to pick their entry point ahead of time if they are interested in buying Facebook at lower prices. Selling out of the money put options gives investors a synthetic long in the stock.
Has a CEO ever gotten married the same weekend of his widely followed IPO?
JON C. OGG