$FB calls quadruple overnight

Option traders racked up huge profits today on upside positions opened in Facebook only one session earlier.

Just yesterday, Investitute’s tracking systems detected the purchase of 10,000 February $147 calls for $6.09 as part of a bullish spread with shares at $146.80. This was clearly a new position, as open interest in the strike was only 1,180 contracts before the trade occurred. Investitute co-founder Pete Najarian cited the unusual activity at that time in naming FB as his final trade on CNBC’s “Halftime Report” yesterday, a few hours before the company announced earnings results.

Those calls traded for as much as $24.18 today, 4 times their purchase price. The stock rose 16.76% at the same time, showing how quickly options can far outpace gains 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.

FB surged 10.82% to $166.69 today. The social network topped quarterly estimates and reported strong usage growth last night despite a wave of negative headlines to hit the company in recent months.