$VST call prices quadruple

Option traders are logging exponential gains today on bullish positions opened in Vistra Energy (VST) earlier this summer.

On June 27, Market Rebellion’s proprietary programs flagged the purchase of 7,200 September $24 calls for $0.50 to $0.55 with shares at $22.12. There was no open interest in the strike before the trade occurred, showing that it was a new position.

Those calls are marked at $1.95 this morning, just shy of 4 times their initial purchase price. The stock rose 17.09% in the same time period, underscoring how options can far outperform their underlying shares.

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.

VST is up 1.07% to $25.90 in early trade. The utility company has been climbing since reporting quarterly results in early August.