NEW YORK (Reuters) - Options traders were placing bets this week that shares of Snap Inc SNAP.N were primed for a rebound after slipping below their initial public offering price of $17.

FILE PHOTO - A woman stands in front of the logo of Snap Inc. on the floor of the New York Stock Exchange (NYSE) while waiting for Snap Inc. to post their IPO, in New York City, New York, U.S. on March 2, 2017. REUTERS/Lucas Jackson/File Photo

Shares of the Snapchat parent have slumped since a red-hot March IPO, falling below their initial sale price on Monday and hitting a record low of $15.21 two days later after a lead underwriter downgraded its rating on the stock.

Traders in the options market have responded to the latest drop in Snap shares as an opportunity to load up on call options, said Fred Ruffy, analyst at New York-based options Analytics firm Trade Alert.

Calls convey the right to buy shares at a fixed price in the future and usually are used to place bets on shares rising, while put options give the right to sell shares at a certain price in the future.

Call options betting on Snap shares topping $16 by mid-October were the most actively traded contracts this week, followed by contracts looking for the shares to move above $17 by July 21, according to Trade Alert data.

“Buying interest in call options with strike prices above the current stock price is often a sign that players are positioning for a short-term move higher in the stock,” said Ruffy.

While open put contracts still outnumbered calls, pointing to significant bearish positioning, that options-based measure of sentiment has become less defensive this week.

There are 1.3 puts open for each open call, the fewest since mid-May and down from 1.5 puts on Monday, Trade Alert data showed on Thursday.

Snap shares were up 3 percent to $15.71 on the day after brokerage Stifel upgraded its rating on the shares to “buy” from “hold” and reaffirmed a $22 price target.

“We believe Snap’s business remains on track fundamentally as it continues to develop innovative consumer products and increasingly sophisticated tools for advertisers,” Stifel analysts said in a note.

Snap’s shares took a tumble in early May after the company reported slowing user growth and revenue in its first earnings report as a public company.

Investors are also eyeing the expiration later this month of a lockup period that has so far restricted company insiders and IPO backers from selling Snap shares.

Analysts at Stifel, however, said that investor concerns about the looming end of the lockup period could have more of an impact on the share price than any actual insider selling after the expiry.