Bulls collect fast money from $SNE

It took just one session for option traders to double their money on upside positions in Sony.

Late yesterday afternoon, Investitute’s marker scanners found that 3,850 Weekly 49.50 calls expiring on May 24 were bought for $1.10 to $1.50 with shares at $50.05. There was no open interest in the strike before the activity appeared, showing that these were new positions.

Those calls sold for as much as $3.13 today, more than twice their purchase prices. The stock rose 4.26% at the same time, underscoring how options can far outperform moves in their underlying shares.

Long calls lock in the price where investors can buy a stock, letting them position for a rally at limited cost with the potential for significant leverage. They carry less risk than owning shares because the most that can be lost is the price of the options no matter how far the stock might fall.

SNE popped 4.12% today to close at $52 even. The Japanese electronics giant, which said yesterday that it would buy back more than $1.8 billion of its stock, today announced a partnership with Microsoft on cloud gaming and artificial intelligence.