$BX call prices spike threefold

Option traders have turned large profits on bullish positions opened in Blackstone (BX) a month ago.

On Oct. 3, our tracking systems detected the purchase of 3,000 December $49 calls in one print for $1.63 above open interest of 1,344 contracts with shares at $46.61. Market Rebellion co-founder Jon Najarian cited the unusual activity at that time on CNBC’s “Halftime Report” and analyzed the trade at the company’s trading conference in Last Vegas the next day.

Those calls have traded for as much as $5.55 so far today, about 3.5 times their purchase price. The stock rose 15.9% in the same time frame, underscoring how options can far outperform 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.

BX reached $54.08 early today before pulling back to $53.05 this afternoon, off 1.14% on the session. The asset-management firm surpassed earnings and revenue expectations on Oct. 23.