$CIEN bulls score overnight

Option traders posted fast profits in Ciena (CIEN) today as shares gapped higher after quarterly results.

Just minutes before the closing bell yesterday on Jun. 2, Market Rebellion’s Unusual Activity Service found that 4,800 July $55 calls were bought for $2.09 to $2.36 above open interest of just 1,934 contracts with shares at $53.71.

Those calls have sold for as much as $5.00 today, over 2 times their purchase prices. The stock rose 10.41% in the same time frame, underscoring 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.

CIEN was last up by 8.34% to $58.95on the session. The network-technology company topped quarterly expectations before the market opened this morning.