Options News
$LYFT bulls make uber-sized profits
Option traders booked uber-sized profits in Lyft (LYFT) today. On Oct. 28, Market Rebellion’s Unusual Activity scanners showed that 9,000 Weekly $22.50 calls expiring this Friday Nov. 6, were bought for $1.42 to $1.57 as part of a bullish roll with shares at $21.54. This was clearly a new position, as open interest in the […]
Option traders booked uber-sized profits in Lyft (LYFT) today.
On Oct. 28, Market Rebellion’s Unusual Activity scanners showed that 9,000 Weekly $22.50 calls expiring this Friday Nov. 6, were bought for $1.42 to $1.57 as part of a bullish roll with shares at $21.54. This was clearly a new position, as open interest in the strike was only 1,561 contracts before that session began.
Those calls traded for as much as $8.50 today, more than 5 times their purchase prices. The stock rose 39.08% in the same time frame, showing how options can far outperform 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.
LYFT was last up 11.82% at $29.33 today. The ride-sharing service is trading higher this morning along with peer Uber (UBER) after Proposition 22 passed in California, keeping drivers classified as independent contractors.