$SKLZ call buyers score big

Option traders are scoring big profits on upside positions in Skillz (SKLZ) today.

On Apr. 19, Market Rebellion’s Unusual Activity tracking systems detected the purchase of 5,000 May $15.50 calls for $1.54 with shares at $14.38. There was no open interest before that session, showing that this was fresh activity.

Those calls have traded up to $5.40 today, over 3.5 times their purchase price. The stock rose 34.42% in the same time period, a large move but 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.

SKLZ was last up 3.43% at $17.34 today. ARK Investment announced it bought over 5 million shares of the online multiplayer platform’s stock during yesterday’s session.