$BE calls power profits

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

On Nov. 23, Market Rebellion’s activity scanners flagged the purchase of 8,400 December $23 calls for $1.00 to $2.10 above the open interest of 181 contracts with shares at $21.96.

Those calls have sold for as much as $5.60 today, at least 2.5 times their purchase prices. The stock rose 25.82% in the same time period, a large move but nowhere near that of its options on a relative basis.

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 down 7.87% to $25.30 during midday trade after making a new 52-Week high earlier of $28.24.