$BX option bulls turn huge gains overnight

Option traders are turning huge gains on bullish positions opened in Blackstone (BX) today.

On Nov. 9Market Rebellion’s Unusual Option Activity Service found that 2,500 Weekly $95 calls, expiring tomorrow, were bought for $0.61 to $0.72 with shares at $91.68. This was clearly fresh buying, as the open interest in the contract before the activity appeared was just 1,773.

Those calls traded up to $8.33 this session, at least 12.5 times their purchase prices. The stock rose 12.62% in the same time frame, underscoring 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.

BX ended the session at $103.52, up 15.09%.

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