Chip bears in $SOXS calls score again

Chip bears are seeing their bets be rewarded again today in upside call positions on the Direxion Daily Semiconductor Bear 3X Shares Fund (SOXS).

On May. 10, Market Rebellion’s UOA tracking systems detected the purchase of 16,000 May $12 calls for $0.25 to $0.30 with shares at $10.38. Volume was well above the strike’s previous open interest of 3,446 contracts, showing that this was fresh interest.

Those calls have traded for as much as $1.00 today, triple their purchase prices. The fund rose 14.93% in the same time period, underscoring how options can far outperform their underlying shares.

This marks the third winning trade in the name to be posted by Market Rebellion in the past week.

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.

SOXS was last up 11.98% today at $12.49. The exchange-traded fund offers 3x daily inverse leverage to the PHLX Semiconductor Index,