Call prices rocket 8-fold in $DIS

Option traders logged huge profits on bullish positions in Walt Disney that expired this afternoon.

On Sept. 17, Investitute’s market scanners showed that 6,000 Weekly $110 calls expiring today were purchased for $0.86 to $1.16 with shares at $109.05. This was clearly fresh buying, as open interest in the strike was only 295 contracts before the trades occurred.

Those calls sold for $6.98 this afternoon, 8 times their initial purchase price. The stock rose 7.29% in the same time frame, underscoring how options can far outperform their underlying shares even in a relatively short period.

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.

DIS was up 0.78% to $116.94 today. The entertainment and media giant has rallied this week after abandoning its pursuit of Sky as part of its $71 billion bid for 21st Century Fox assets, relieving the company of an estimated $15 billion needed to buy the U.K. satellite broadcaster.