$UBER call buyers book profits

Option traders are booking profits on upside positions in Uber (UBER) today.

On Apr. 8, Market Rebellion’s Unusual Options Activity service found that 8,000 April $58 calls were bought for $0.90 to $1.28 with shares at $56.75. Open interest in the call strike was only 1,506 contracts before the trades occurred, indicating that this was new positioning.

Those calls traded for as much as $3.05 so far today, or over 2 times their purchase prices. The stock rose 7% in the same time frame, illustrating the kind of leverage that can be achieved 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.

UBER was last at $59.26, up 2.6% on the session. The ride-sharing service announced today that March 2021 gross bookings reached their highest monthly level in company history.