$INO call prices rise sharply

Inovio Pharmaceuticals (INO) spiked higher today on positive developmental news regarding its COVID-19 vaccine, sending call prices higher.

On May 18, Market Rebellion’s Unusual Activity Service found that 14,200 Weekly $14 calls expiring this Friday, May 22, were bought $0.80 to $1.30 with shares at $14.08. This was clearly a new position, as open interest in the strike before that session began was only 3,554 contracts.

Those calls traded for as much as $2.97 today, at least 2 times their purchase prices. The stock rose 20.03% in the same time frame, 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.

INO was up 8.45% to $15.79 today. The biotechnology company announced this morning positive data from its preclinical study of its INO-4800 COVID-19 DNA vaccine.