$SIX call prices ride higher

$SIX call prices ride higher

by

Upside option position are riding higher today as Six Flags Entertainment (SIX) rises.

On Oct. 24Market Rebellion’s Unusual Activity Service identified the the purchase of 3,500 November $17.50 calls for $1.80 to $1.85 with shares at $18.48. Volume was clearly above the previous open interest of 3 contracts, indicating that this was a new position.

Those calls are currently marked for $6.10 today, a 229.73% return, while the stock surged 30.03% in the same time period, an enormous move but one that was still dwarfed by the gain 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.

SIX was last up by 7.47% to $24.03.

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