Options News
Option bulls score in $HOOD
Option traders are making big gains on upside positions in Robinhood Markets Inc (HOOD) today. On Jun. 21, Market Rebellion’s Unusual Option Activity Service found that 5,500 Weekly $8 calls, expiring Jul. 1, were bought for $0.25 to $0.30 with shares at $7.52. This was clearly fresh buying, as open interest in the strike was only 1,144 […]
Option traders are making big gains on upside positions in Robinhood Markets Inc (HOOD) today.
On Jun. 21, Market Rebellion’s Unusual Option Activity Service found that 5,500 Weekly $8 calls, expiring Jul. 1, were bought for $0.25 to $0.30 with shares at $7.52. This was clearly fresh buying, as open interest in the strike was only 1,144 contracts before that session began.
Those calls have traded for as much as $1.90 so far today, or over 6 times their purchase prices. The stock rose 25% in the same time frame, illustrating the kind of leverage that can be achieved 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.
HOOD was last at $9.37, up 17.13% on the session.
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