Call prices spike sixfold in $SYY

Option traders posted exponential gains today in Sysco on bullish positions opened just one session earlier.

In the last hour of trading on Aug. 10, Investitute’s market scanners identified the purchase of 3,100 August $71 calls for $0.50 to $0.70 with shares at $68.63. These were clearly new positions, as open interest in the strike was only 230 contracts before that session began.

Those calls traded up to $3.10 today, 6 times their initial purchase price. The stock rose 7.84% at the same time, showing how quickly 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.

SYY jumped 6.24% to $72.75 today. The food-service company beat earnings and revenue estimates this morning.