$BUR call prices rise 7-fold

$BUR call prices rise 7-fold

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Bullish option traders have found big gains this session in Burford Capital Limited (BUR).

On Mar. 28, Market Rebellion’s Unusual Option Activity Service identified the purchase of 10,000 May $7.50 calls as part of a bullish spread for $0.59 to $0.62 with shares at $6.85. The volume was well above the open interest of 1,236 contracts at the time, indicating that this was a new position.

Those calls have traded for as much as $4.50 so far today, over 7 times their purchase prices. The stock rose 72.7% 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.

BUR was last up by 48.34% to $10.71 in afternoon trade.

Ready to start trading? Try Unusual Option Activity Essential. Learn how you can follow the “smart money” with a fresh UOA trade idea each week – including technical levels so that you know how to manage each trade!

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