$VIPS call prices rocket 18-fold

Bullish traders posted astronomic gains in Vipshop today.

On Nov. 21, Investitute’s tracking systems detected the purhcase of 5,100 February $10 calls in one print for $0.35 with shares at $8.29. This was clearly a new position, as volume was above the strike’s open interest of 4,765 contracts.

Those calls traded up to $6.40 today, more than 18 times their purchase price. The stock rose 97.7% in the same time period, a huge move but one that still paled in comparison to that of its options. It is the second winning trade in Vipshop posted on Investitute in the last month.

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.

VIPS jumped 10.54% to $16.04 today. Bernstein upgraded the name two notches to “outperform” from “underperform” and raised its price target to $23.50 from $9.20.