$BE call prices spike

Option traders are collecting big gains on bullish positions in Bloom Energy (BE) today.

On Aug. 23, Market Rebellion’s Unusual Option Activity Service found that 10,000 November $12 calls were bought for $1.60 with shares at $11.70. This was clearly fresh interest as the open interest was just 4,127.

Those calls have changed hands for as much as $8.10 this session, an 406.25% return, while the stock rose 71.28% in the same time frame, illustrating the kind of leverage that can be achieved with options.

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.

BE is currently trading up by 58.58% to $21.06.