$UBER call buyers patience pays off

$UBER call buyers patience pays off

by

Option traders are booking big profits on upside positions in Uber (UBER) today.

On Jun. 2, 2022Market Rebellion’s Unusual Option Activity Service found that 5,000 January, 2024 expiring $60 calls were bought for $0.80 with shares at $23.12. This was clearly fresh buying, as open interest in the contract was just 3,015 before the activity appeared.

Those calls have traded for as much as $5.00 today, a 525% return, while the stock rose 180.75% in the same time period, underscoring 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.

UBER was last at $63.60, up 0.2% on the session.

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