$BA call prices double overnight

Option traders who opened bullish positions in Boeing (BA) yesterday were rewarded with profits today.

Just yesterday, Nov. 2, Market Rebellion’s Unusual Activity programs found that 2,500 Weekly $147 calls expiring this Friday, Nov. 6, were bought for $3.14 to $3.95 with shares at $144.10. Volume was well above the strike’s existing open interest of 518 contracts, indicating that this was fresh buying.

Those calls traded for as much as $8.15 so far this morning, 2 times their purchase prices. The stock rose 6.52% in the same time period, showing how 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.

BA was last up on session by 3.63% at $154.00. Morgan Stanley noted this morning that it sees an attractivebuying opportunity in Defense stocks.