SpaceX (NASDAQ: SPCX) is rocking Wall Street \u2014 and traders are piling on to get a piece of the action. Just a few days after the company went public on June 12, Elon Musk\u2019s rocket-and-AI company started options trading Tuesday, and the bets rolled in faster than they have for any other company in history. More than 1.6 million contracts changed hands on day one, according to Bloomberg data cited by Business Insider (1) \u2014 that\u2019s more than four times the 364,000 first-day record set by Facebook when its options debuted in 2012.<\/p>\n
SpaceX, which filed to go public this spring (2) and priced its IPO at $135 a share (3), sold more than 555 million shares to raise roughly $75 billion \u2014 the largest IPO in history, eclipsing Saudi Aramco\u2019s Wall Street debut in 2019. But things have yet to settle: By Tuesday\u2019s close, it traded around $202, about 50% above its offering price. SpaceX\u2019s market value briefly leapfrogged both Amazon and Microsoft (4) to rank among the most valuable companies in the US.<\/p>\n
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The biggest winner, of course, is Elon Musk. The offering made SpaceX\u2019s founder and CEO the world\u2019s first trillionaire, at least on paper (5). And as SpaceX shares kept climbing, his fortune reached about $1.4 trillion Tuesday<\/a>, per Forbes \u2014 more than $1 trillion ahead of the next-richest person.<\/p>\n What options actually are <\/p>\n If you\u2019re relatively new to the Wall Street scene, you\u2019re probably wondering about the significance of those 1.6 million bets. Options (6), for the uninitiated, are contracts that give their buyer the right, but not the obligation, to buy or sell shares of a stock at a fixed price by a fixed date. A call is a bet that the stock rises; a put is a bet that it falls. That fixed price is the \u201cstrike,\u201d the deadline is the \u201cexpiration,\u201d and each contract \u2014 or lot \u2014 controls 100 shares. That\u2019s why a modest sum can command an outsized position. The leverage is the appeal, but also the danger: options can multiply gains, and they can expire completely worthless.<\/p>\n Used carefully, options are insurance \u2014 a way to hedge a portfolio against a drop. But they\u2019re also speculation fuel, a way to juice returns by stacking on risk. The most-traded contracts tell the story. The single most popular was a call betting SPCX would climb about 9% to $220 by Thursday, trailed by one wagering on a more modest 4% rise. Further down sat the lottery tickets \u2014 a call needing a roughly 50% rally to $300 in two days \u2014 alongside protective puts. (Volume alone doesn\u2019t show whether traders were buying or selling, so it can\u2019t be read as simple bullishness.)<\/p>\n Story Continues <\/p>\n None of this is happening in a vacuum. Retail options trading has exploded since the pandemic (7), powered by zero-commission apps and the meme-stock frenzy that surrounded GameStop. Same-day \u201c0DTE\u201d contracts (8) \u2014 options that expire the day they\u2019re traded \u2014 now make up roughly a quarter of all U.S. listed options volume, and retail brokers drive about half the total. SpaceX, with only a thin slice of its shares actually trading freely<\/a>, was tailor-made for that crowd.<\/p>\n One revealing detail from Tuesday: The most popular contract not set to expire within a matter of days was a September put, which Susquehanna analysts read as hedging ahead of an early lock-up expiration \u2014 the date when insiders can finally begin selling.<\/p>\n Read More: About 1 in 5 Americans over 50 has zero retirement savings. Here’s why it’s not too late<\/a><\/p>\n Why Facebook\u2019s record stood for 14 years <\/p>\n The mark SpaceX just blew past belonged to Facebook. Mark Zuckerberg\u2019s social-media giant went public on May 18, 2012 (9) at $38 a share, raising about $16 billion in what was then the largest tech IPO ever and valuing the company near $104 billion. But the debut was famously rough: A technical failure froze Nasdaq\u2019s systems (10), order confirmations were delayed for hours, and the stock limped to a $38.23 close \u2014 barely above its offer price, a result plenty of investors found deflating.<\/p>\n Notably, though, Facebook options didn\u2019t trade on IPO day. They (11)went live about a week and a half later (12), on May 29, once the exchanges listed them \u2014 and that first session set the debut benchmark of roughly 364,000 contracts that stood until this week. SpaceX, by contrast, had options trading within a few days of its listing.<\/p>\n Why did Facebook\u2019s number hold for 14 years? To put it simply, the market at the time was a very different place. In 2012, options were still mostly the territory of professionals and sophisticated traders. There were no zero-commission smartphone apps pulling in millions of first-timers, no daily-expiring 0DTE contracts, and nothing resembling today\u2019s retail army. Cboe data shows U.S. options volume has since broken record after record, with 2024 marking the fifth straight year of all-time highs (13). So basically: A debut that looked enormous in 2012 looks considerably more modest today, where ordinary investors make an impact that previously only institutions could achieve.<\/p>\n To wit, SpaceX clearly built its IPO for the masses. The company reserved an unusually large 30% of its Wall Street debut for retail buyers; President Gwynne Shotwell said that was by design. She told CNBC (4) that Musk \u201cwanted regular people to be able to buy the stock, and a lot of folks participated at the retail level.\u201d<\/p>\n You May Also Like <\/p>\n Join 250,000+ readers and get Moneywise\u2019s best stories and exclusive interviews first \u2014 clear insights curated and delivered weekly. Subscribe now.<\/a><\/p>\n Article Sources <\/p>\n We rely only on vetted sources and credible third-party reporting. For details, see our ethics and guidelines<\/a>.<\/p>\n Business Insider (1<\/a>); U.S. Securities and Exchange Commission (2<\/a>); CNBC (3<\/a>), (4<\/a>); CBS News (5<\/a>); Charles Schwab (6<\/a>), (8<\/a>); Traders Magazine (7<\/a>), (10<\/a>); History.com (9<\/a>); Seeking Alpha (11<\/a>); East Bay Times (12<\/a>); MarketsMedia (13<\/a>)<\/p>\n This article originally appeared on Moneywise.com<\/a> under the title: SpaceX just obliterated Facebook’s 14-year options record by more than 4X \u2014 1.6 million bets in a single day<\/a><\/p>\n This article provides information only and should not be construed as advice. 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