$SQ calls triple overnight

It took less than 24 hours for bullish option traders to run up exponential gains in Square (SQ).

Late yesterday, Market Rebellion’s tracking systems found that 8,000 Weekly $62.50 calls expiring this afternoon were bought for $0.14 to $0.25 with share sat $61.72. This was clearly fresh buying, as open interest in the strike was only 1,086 contracts before the activity appeared.

Those calls traded for as much as $0.68 today, 3.5 times their average purchase price. The stock rose 2.37% illustrating the kind of leverage that can be achieved quickly with options.

Long calls lock in the price where a stock can be purchased, gaining with a rally and providing leverage to the underlying shares. The contracts can quickly lose value if the stock stalls or pulls back but also carry less risk than owning the shares themselves.

SQ is up 1.96% to $62.93 heading into the closing bell today. The electronic-payment service is scheduled to report earnings after the market closes on Nov. 6.