Traders run up score in $GLUU

Bullish option traders more than doubled their money in Glu Mobile today.

On May 3, Investitute’s proprietary programs flagged the purchase of 5,000 September $5 calls for $0.56 as part of a bullish spread with shares at $4.96. Volume was far above the strike’s open interest of 271 contracts, showing that this was a new position.

Those calls traded up to $1.41 this morning, 2.5 times their purchase price. The stock surged 27.82% in the same time period, a large move but still far less than 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.

GLUU spiked higher by 10.88% to $5.91 today. The mobile-game developer topped revenue forecasts and raised its full-year outlook this morning.