$SOUN call buyers quadruple money intraday

$SOUN call buyers quadruple money intraday

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Bullish option traders are listening to big gains this session in SoundHound AI Inc (SOUN).

This morning on Mar. 31, Market Rebellion’s Unusual Option Activity Service identified the purchase of 2,000 Weekly $2 calls, expiring Apr. 6, for $0.14 to $0.15 with shares at $1.99. The volume was well above the open interest of 215 contracts at the time, indicating that this was a new position.

Those calls have traded for as much as $0.65 so far today, over 4 times their purchase prices. The stock rose 27.64% 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.

SOUN was last up by 26.90% to $2.50 in afternoon trade.

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