Option bulls stack fast profits in $SAVA

Option traders are stacking fast profits in upside option positions that were opened on Cassava Sciences Inc (SAVA) this morning.

Just hours ago, on Aug. 17Market Rebellion’s Unusual Option Activity Service found that 6,100 August $30 calls were bought for $0.50 to $1.60 with shares at $27.37. above the contract’s existing open interest of 2,062.

Those calls have traded for as much as $6.45 this session, over 4 times their purchase prices. The stock gained 25.47% at the same time, a large move but nowhere near that of its options on a relative basis.

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.

SAVA was last higher on the day by 23.45% at $24.95.

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