Calls shine as $SEDG soars

Bullish option traders doubled their money in SolarEdge Technologies today, thanks to strong quarterly results.

On April 18, Investitute’s tracking systems cited the purchase of 3,700 September $45 calls for $4.30. The trade was part of a bullish spread with shares at $43.34 at the time.

Those calls traded for as much as $10.85 today, more than 2.5 times their purchase price. The stock rose 22.96% in the same time frame, a large move but nowhere near that of its options 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.

SEDG spiked higher by 22.7% to $53.84 today. The solar-power company beat earnings and revenue estimates after the market closed yesterday.