In a move poised to reshape the investment landscape, Nasdaq is slated to introduce options contracts for technology powerhouse Arm Holdings on Monday. This development will enable investors to wager on the fate of one of this year’s most anticipated initial public offerings.
According to a spokesperson for the exchange, all six Nasdaq exchanges are set to feature options for Arm Holdings, though other options exchange operators have refrained from making official statements.
Nasdaq recently announced its commitment to streamline the process of listing and trading options for select securities post-IPO, with an ambitious target of enabling trading as early as the second business day following the offering.
Analysts are abuzz with anticipation, foreseeing a robust market reception driven by the fervor surrounding the Arm situation and the burgeoning field of Artificial Intelligence. Notably, the 2012 introduction of options for Facebook Inc., now Meta Platforms, holds the distinction of the most active options market debut, with a staggering 360,000 contracts changing hands on its inaugural day.
Arm Holdings, known for its chips with artificial intelligence (AI) applications, may not have the household recognition of Facebook, but retail traders are expected to show keen interest in the options. This surge is attributed to the widespread excitement surrounding the IPO and the broader investor enthusiasm for AI technology, as noted by Sosnick.
Arm Holdings has particularly captured the attention of retail investors, affirmed by Dan Raju, CEO of online brokerage firm Tradier. Raju pointed out an anticipated “initial surge in options activity followed by a tapering” of volume.
As of Friday afternoon, Arm Holdings shares have been trading around $63.55, marking a 25% surge from the stock’s IPO pricing. This substantial movement indicates a keen appetite for options among investors seeking exposure to the company’s trajectory.
The introduction of options offerings has injected an extra layer of excitement into what is already a groundbreaking Arm Holdings IPO. Analysts and retail investors alike are on tenterhooks, awaiting the unveiling on Monday, as only time will reveal the initial market sentiments and investment trends.
Source: Reuters
