$TEVA calls double in hours

Option traders are turning fast gains on upside option positions that were opened today in Teva Pharmaceutical (TEVA).

Just this morning, Market Rebellion’s Unusual Activity programs detected the the purchase 14,000 Weekly $10 calls, expiring this Friday, for $0.05 to $0.18 with shares at $9.20. Open interest in the contract before the trade occurred was just 2,762, showing that this was a new position.

Those calls have traded for as much as $0.38 so far this session, at least double their purchase prices. The stock gained 11.63% at the same time, 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.

TEVA was last higher on the day by 14.97% at $10.26.