$BIDU call prices triple overnight

Bullish option traders are making big profits today on upside bets made in Baidu (BIDU) yesterday.

Yesterday, on Oct. 18, Market Rebellion’s Unusual Activity Service found that 2,800 Weekly $180 calls, expiring next Friday, were bought for $1.16 to $1.55 above open interest of 430 contracts with shares at $168.07.

Those calls traded for as much as $4.60 today, about triple their purchase prices. The stock rose 6.52% at the same time, illustrating the kind of leverage that can be achieved with options.

Long calls lock in the price where a stock can be purchased, gaining with a rally and providing leverage to the underlying shares. The contracts can quickly lose value if the stock stalls or pulls back but also carry less risk than owning the shares themselves.

BIDU was up 4.65% to $179.00 at the closing bell today.