An options trader wagered $40 million that Meta Platforms, Inc.’s 158% rally this year has plenty of room to run.

The spread trade — involving more than 26,000 contracts of call options allowing the buyer to pick up shares at $320 each by Jan. 17, 2025 — was countered by selling about 52,000 of $600 calls expiring in December of that year.

The bet comes at a hefty price, with more than $15 each, or $40.6 million, in premium changing hands, meaning shares would need to rally about 8% before it breaks even. Of course, in the derivatives world, the options need not ever be in-the-money to make money, and are unlikely to be held to expiration. A steady rally would likely allow the spread buyer to exit the position at a profit.

The trades occurred simultaneously and on the same exchange, signaling that they were likely done by the same investor. That fact, coupled with the high strike price of the December call option, suggests that the investor paid the premium as part of some broader strategy.

“Assuming it’s buying the 320-strike vs selling the 600-strike, it’s a view that there’s some upside in the stock but not extreme upside,” said Rocky Fishman, founder of derivatives analytical firm Asym 500. “Long-dated trades aren’t about the premium, they’re about the net risk in the whole trade.”

--With assistance from Matt Turner.