Option traders are scoring profits on upside positions in Oscar Health Inc (OSCR) today as shares soar.
On Jan. 17, Market Rebellion’s Unusual Activity programs found the the purchase of 4,500 February $12.50 calls for $0.65 to $0.80 above the existing open interest of 488 with shares at $11.13.
Those calls have traded for as much as $4.81 today, a 501.25% return, while the stock rose 55.36% at the same time, showing how options can far outperform their underlying shares.
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.
OSCR was last up 25.09% at $16.80.
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