$U call prices move higher

$U call prices move higher

by

Unity Software Inc (U) is lending large profits to bullish option positions today.

On Jun. 27Market Rebellion’s Unusual Activity Service found that 4,800 Weekly $40 calls, expiring this Friday, were bought for $0.74 to $1.17 above the existing open interest of 2,747 contracts with shares at $38.82.

Those calls have traded for up to $4.30 today, a 267.52% return, while the stock rose 13.99% in the same time frame, showing how quickly options can far outpace gains in 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.

U was down 1% at $43.68 at the close of trade.

Ready to start trading? Try Unusual Option Activity Essential. Learn how you can follow the “smart money” with a fresh UOA trade idea each week – including technical levels so that you know how to manage each trade!

Subscribe to Rebel Roundup for your weekly digest of market highlights and free trading lessons.
We’re on a mission to empower retail traders with the tools they need to succeed.

Join a growing community of traders with Market Rebellion

Join the thousands of users daily!
Start Your Day the Smart Money Way

Real-time Analysis

Interactive Chat Q&A
Professional Tactics