$ASHR bulls triple money

Option traders racked up another winning position today in the Xtrackers Harvest CSI 300 China A Fund.

On Feb. 22, Investitute’s proprietary programs showed that 3,125 Weekly $27.50 calls expiring on March 29 were purchased in one print for $0.40 with shares at $26.42. This was clearly a new position, as open interest in the strike was a mere 32 contracts before the activity appeared.

Those calls traded for as much as $1.45 today, more than 3.5 times their purchase price. The stock rose 6.78% in the same time frame, illustrating the kind of leverage that can be achieved with options.

It is the second winning trade in the name posted on Investitute this week. Investitute co-founder Pete Najarian also cited buying in July $31.71 calls on CNBC’s “Halftime Report” this afternoon.

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.

ASHR was up 2.66% to close at $28.19 this afternoon. The exchange-traded fund, which tracks China’s CSI 300 Index, rebounded after new PMI data from Beijing showed that economic fears may be overblown. In addition, global index provider MSCI announced last night that its long-awaited increase of Chinese A Mid-Cap shares would take place in three stages, culminating in an increase of their inclusion in the ETF from 5% to 20% by November.