Facebook Inc (NASDAQ:FB) stock rallied in the market after the giant social network announced plans to roll out a new a feature for its Messenger app. The feature will allow more than 500 million users to send and receive money between friends. Call volumes in the options market as a result of the news were up, three times more than puts, reports CNBC’s Dan Nathan.
The increase in call volumes goes to show how investors remain bullish on the stock. As Facebook Inc (NASDAQ:FB) continues to dominate the mobile ecosystem while tapping into other offerings such as payment systems.
“Options traders like the action here call volumes three times that of puts and there was one trade out in May expiration that caught my eyes. When the stock was $79.40, the trader bought 6000 of the May 88, 50 calls paying $1.13,” said Mr. Nathan.
The trade essentially shows that the trader remains bullish on the stock surging to a high of $88.63 or 11% higher at May expiration. The bullish sentiments seem to have been elicited by the recent wave of positive news regarding the company. Facebook Inc (NASDAQ:FB) is slowly becoming a force to reckon with, in the mobile ecosystem while its advertisement business continues perform well.
The new feature that allows messenger users to send and receive money from friends will become available in the U.S in the months to come and will be initially available for free. Facebook is not new to payment processing systems having already processed transactions on its larger site for years. The Menlo Park, Calif Company currently processes nearly 1 million transactions on its site while also handling payments handled by Messenger.
Messenger users will be able to transfer money right away although it would take some time for the money to become available depending on the bank facilitating the transaction. The feature should be safe as it uses secure systems that encrypt connection between users and Facebook Inc (NASDAQ:FB) as well as stored card information.
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