Bulls watch fast gains in $LGF.A

Bullish traders are watching fast gains today in Lionsgate (LGF.A).

On Nov. 4, our Unusual Option Activity tracking systems detected the purchase of 6,000January $9 calls for $0.11 to $0.20 above open interest of 1,019 contracts with shares at $6.97.

Those calls traded for as much as $0.86 today, at least 4 times their purchase prices. The stock rose 31.13% in the same time frame, 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.

LGF.A closed at $9.16, up 3.39% on the session. The entertainment company’s stock price target was raised to $12 from $10 at Deutsche Bank yesterday.