$PBR call prices double in minutes

Nimble bullish option traders are racking up fast gains in Petrobras (PBR).

Just in the past hour, Our market scanners identified the fast purchase of 9,000 Weekly $14 calls expiring this Friday from $0.06 to $0.12 with shares at $13.64. Volume was above the strike’s previous open interest of 1,285 contracts, showing that this was a new position.

The Weekly $14 calls traded for as much as $0.30 less than an hour later, more than 2 times their purchase prices. The stock rose 3.37% in the same time period, showing how 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.

PBR is up 5.35% to $13.76 in late session trading. The Brazilian government announced earlier that it is looking to privatize the energy giant.