$SNAP call prices rocket 11-fold

Bullish option traders racked up astronomical gains today after Snap surprised Wall Street with strong quarerly results.

On Jan. 18, Investitute’s market scanners found that 6,100 Weekly $15 calls expiring this Friday were purchased for $0.55 to $0.68 with shares at $13.94. These were clearly new positions, as volume was far above the strike’s open interest of 1,320 contracts. Investitute co-founder Jon Najarian cited the unusual activity at that time on CNBC’s “Halftime Report.”

Those calls traded for $6 today, just shy of 11 times their original purchase price. The stock soared 50.6% in the same time frame, a huge move but still nowhere near that of its options.

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 spiked higher by 44.67% to $20.34 today, its largest gain since going public last year. The social-media company blew past earnings and revenue estimates after the market closed yesterday.