Alibaba options set for strong demand on market debut

http://ift.tt/eA8V8J [Reuters] - The newest way to bet on the fortunes of Chinese e-commerce heavyweight Alibaba Group Holding Ltd will debut on Monday when its stock options go live for trading, and investors should look for the initial action to be very busy, but also choppy and potentially pricey. Options market traders say Alibaba puts and calls will likely see heavy demand given the interest shown so far in the stock since its record-setting $25 billion initial public offering last week. First-day volume in the stock last Friday topped 270 million shares and has averaged around 40 million shares a day since, keeping it near the top of the New York Stock Exchange's most-active list each day. "I would expect Alibaba's options to have a built-in demand, so to speak, as obviously all the people who want to get into the IPO at the beginning didn’t," said J.J. Kinahan, chief market strategist at retail brokerage TD Ameritrade Holding Corp.



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