$JNPR bulls triple money in hours

Option traders who opened bullish positions in Juniper Networks this morning were collecting large profits by early afternoon.

A few minutes after the opening bell, Investitute’s proprietary programs indicated that 3,900 Weekly $28.50 calls expiring this Friday were purchased for $0.20 to $0.48 with shares at $28.15. This was clearly fresh buying, as previous open interest in the strike was only 81 contracts.

Those calls traded for as much as $1.02 just after noon ET, 3 times their average purchase price. The stock rose 4.26% at the same time, showing 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.

JNPR jumped 5.18% to $29.44 today. The networking-technology company, which has been the subject of buyout speculation, presented at two industry conferences yesterday.