$SKLZ call buyers score big overnight

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

On Aug. 31, Market Rebellion’s Unusual Activity tracking systems detected the purchase of 7,500 Weekly $12 calls, expiring this Friday, Sep. 3, for $0.10 to $0.40 with shares at $11.16 and above the previous open interest 2,503, showing that this was fresh activity.

Those calls traded up to $2.15 today, over 5 times their purchase prices. The stock rose 24.91% 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 up 3.74% closing at $12.21 today.