$TSLA bulls score a huge win in days

Shares of Tesla opened higher this morning, delivering significant gains to upside option positions opened earlier in the week.

Just two days ago, on June 4, Investitute’s market scanners showed that 10,000 August $250 calls were purchased for $2.51 and $2.75 with shares at $179.84. This was clearly a new position, as open interest in that contract was just 2,301 before the trade occurred.

Those calls traded traded for as much as $9.50 before noon today, almost 4 times their purchase price. The stock surged 14.77% 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 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.

TSLA gapped higher this morning to run to its current high on the day of $211.00 but has since pulled back, at the time of publication up 4.94% on the day at $206.30. The electric car maker jumped after Electrek said North America sales were on pace for a record.