$EBAY call prices spike in minutes

It took less than half an hour for bullish option traders to double their money in eBay (EBAY) today.

At 12:40 p.m. ET, Unusual Activity Service found that 2,000 Weekly $37 calls expiring on Feb. 28 were bought for $0.80 to $0.85 above open interest of 244 contracts with shares at $37.56. Market Rebellion co-founder Jon Najarian cited the unusual activity at that time on CNBC’s “Halftime Report.”

Those calls traded up to $2.10 about 25 minutes after they were posted, about 2.5 times their purchase prices. The stock rose 3.14% at the same time, illustrating the kind of leverage that can be achieved quickly with options.

Long calls lock in the price where a stock can be purchased, gaining with a rally and providing leverage to the underlying shares. The contracts can quickly lose value if the stock stalls or pulls back but also carry less risk than owning the shares themselves.

EBAY is up 2.03% to $38.45 this afternoon. Various news outlets reported that private-equity firms have expressed interest in buying the online auction giant’s classifieds division, which some analysts have estimated to be worth $10 billion.