$LYFT bulls score a winner

Option traders scored big profits in Lyft (LYFT) today.

On Oct. 28, Market Rebellion’s Unusual Activity scanners showed that 7,000 November $25 calls were bought for $1.22 to $1.32 with shares at $21.51. This was clearly a new position, as open interest in the strike was only 3,370 contracts before that session began.

Those calls traded for as much as $13.50 today, more than 10 times their purchase prices. The stock rose 78.97% in the same time frame, showing how 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.

LYFT was last unchanged from the yesterday’s close at about $36.06, after trading as high as $37.29 earlier in the day. The ride-sharing service beat estimates for its top and bottom lines during its Q3 report after the close yesterday.