$SNAP bulls triple money

Upside option positions opened in Snap (SNAP) at the beginning of the week are already paying exponential gains today.

On July 22, Investitute’s market scanners identified the purchase of 4,500 August $14.50 calls for $0.97 to $0.99 as part of a bullish spread with shares at $14.10. There was no open interest in the strike before the trade occurred, showing that it was a new position.

Those calls traded for as much as $3 today, more than 3 times their purchase prices. The stock rose 23.54% in the same time frame, 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.

SNAP is up 17.26% to $17.39 this afternoon. The social-media company reported strong user growth and blowout revenue numbers after the market closed yesterday.