Option bulls $DASH for gains

Option traders are making big gains on bullish positions opened in DoorDash (DASH) last month.

On May 27, Market Rebellion’s Unusual Activity Service identified the the purchase of 2,700 June $165 calls for $1.88 to $3.20 with shares at $143.12. Volume was clearly above the previous open interest of 1,742 contracts, indicating that this was a new position.

Those calls have traded for as much as $9.50 this session, about triple their purchase prices. The stock rose 21.89% in the same time frame, illustrating the kind of leverage that can be achieved quickly with options.

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.

DASH was last up by 5.04% to $172.87 in afternoon trade, setting a new 3-Month high.