$SGMS call prices soar higher

Scientific Games (SGMS) is giving bullish option traders the opportunity to cash in on upside option positions for significant gains today

On Apr. 15, Market Rebellion’s UOA Service flagged the purchase of 5,700 May $50 calls for $1.50 to $2.10 with shares at $43.70. Volume was well above the strike’s open interest of 2,271 contracts, showing that this was clearly a new position.

Those calls have traded for $10.50 today, more than 5 times their purchase price. The stock rallied 38.12% in the same time period, a huge move but still nowhere near that of its options on a relative basis.

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.

SGMS has jumped to a new 52-Week high this session, last up by 2.97% at $61.28.