Strong finish for bulls in $ZNGA

A Thanksgiving trade in Zynga yielded a bounty of profits on upside options that expired this afternoon.

Back on Nov. 26, Investitute’s proprietary programs flagged the purchase of 5,500 March $4.50 calls for $0.08 and $0.09 with shares at $3.54. This was clearly fresh buying, as open interest in the strike was only 493 contracts before that session began.

Those calls traded for as much as $0.90 this afternoon, at least 10 times their purchase prices. The stock rallied 52.82% in the same time period, a huge move but still nowhere near that of its options on a relative basis.

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.

ZNGA reached a 52-week high of $5.42 three times today but ended the session lower by 0.56% at $5.37. The social-game developer has rallied this year with positive quarterly results.