Calls triple overnight in $CPRI

Upside option positions opened in Capri just one session earlier have already paid off exponentially.

Just yesterday, Investitute’s tracking systems detected the purchase of 3,500 February $45 calls for $1.45 to $1.47 as part of a bullish spread with shares at $42.98. Investitute co-founder Jon Najarian cited the unusual activity at that time in choosing Capri as his final trade on CNBC’s “Halftime Report.”

Those calls traded for as much as $5 today, about 3.5 times their purchase prices. The stock rose 15.89% at the same time, showing how quickly options can far outpace gains in 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.

CPRI surged 11.3% to $48.47 today. The U.K.-based luxury retailer, formerly Michael Kors, beat quarterly expectations before the market opened this morning.