Trading in SpaceX options kicked off with record volume on Tuesday, underscoring strong investor demand for exposure to Elon Musk's aerospace company. More than half a million contracts changed hands in the first hour of trading, making SpaceX the most heavily traded name ever among companies on their first day of options trading.
"Early option volume indicates another SpaceX success," said Seth Hickle, chief investment officer at Mindset Wealth Management.
Options provide a low-cost way to gain exposure to a company's stock or to hedge against risk. Calls led puts 1.5-to-1, with 675,000 contracts traded by 10:40 a.m. ET. Susquehanna's co-head of derivatives strategy, Chris Murphy, noted that investors continue chasing upside in high-beta space and AI winners.
"It's really kind of going nuts," said Brent Kochuba, founder of options analytic service SpotGamma.
SpaceX options were the second-most heavily traded contracts on individual companies Tuesday, trailing only Tesla. The robust activity follows Friday's strong debut, when shares surged more than 25%, pushing the valuation above $2 trillion. Shares rose more than 8% on Tuesday, sending the market valuation above Amazon.com.