$CRON calls triple in hours

Bullish option traders who bought Cronos (CRON) this morning were already logging exponential gains by the afternoon.

Less than an hour after the opening bell, our tracking systems found that 8,700 Weekly $9 calls expiring Friday afternoon were bought for $0.09 to $0.20 above open interest of 4,898 contracts with shares at $8.91. Market Rebellion co-founder Jon Najarian then cited the unusual activity on CNBC’s “Halftime Report.”

Those calls have traded for as much as $0.45 so far today, more than 3 times their average purchase. The stock rose 4.15% at the same time with volume surpassing 24,000 contracts, showing how quickly options can far outpace gains in their underlying shares.

It is the second winning trade in the name posted on Market Rebellion in just over a 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.

CRON is up 3.65% to $9.09 this afternoon. Stifel upgraded the medical-marijuana company to “buy” from “hold” on Oct. 18.