Options Trading In Facebook Shares Begins On Day Stock Reaches New Low

By David Cohen 

Facebook shares reached a new low of $28.84 apiece Tuesday, the first day that options trading was allowed.

Bloomberg reported that more than 200,000 puts, which give the right to sell Facebook shares, were traded Tuesday.

According to Bloomberg, June $30 puts represented the most active options contracts, with 23,723 of them traded, followed by June $34 calls and June $32 calls.

$38 per share seems so far away.

Matt McCormick of Bahl & Gaynor told Bloomberg in a phone interview:

People are disillusioned. A lot of investors believed the hype. In this type of volatile market environment, people are not going to take chances.

And Pivotal Research Group Senior Analyst Brian Wieser told Bloomberg in a phone interview:

Investors are incorporating the risks embedded in the stock. A lot of people are trying to trade the stock on the basis of those expectations. Options will be a very robust marketplace with respect to Facebook.

Readers: Do you think Facebook shares will eventually bounce back, or is this initial public offering cursed?

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