Call buyers land big gains in $MQ

Option bulls are being rewarded today with big profits on upside positions in Marqeta Inc (MQ).

On Oct. 20, Market Rebellion’s Unusual Activity Service found that 2,050 December $22.50 calls were bought, in-the-money, for $4.50 to $5.10 above the existing open interest of 541 with shares at $26.14.

Those calls traded for as much as $14.50 during this session, more than 2.5 times their purchase prices. The stock rose 39.82% in the same time frame, showing how options can far outperform their underlying shares 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.

MQ settled the session at $32.36, up 0.81% on the session.