$BA option profits soar again

Option traders who opened bullish positions in Boeing (BA) one session earlier were again rewarded with profits today as call prices flew higher.

Yesterday on Mar. 10, Market Rebellion’s Unusual Activity programs found that 15,000 Weekly $240 calls, expiring this Friday, Mar. 12, were bought for $1.54 to $3.25 with shares at $233.50. Volume was well above the strike’s existing open interest of 9,138 contracts, indicating that this was fresh buying.

Those calls traded for as much as $17.05 today, at least 5 times their purchase prices. The stock rose 9.87% in the same time period, showing how options can far outpace gains in their underlying shares.

This marks the second high flying trade in the name to be posted by Market Rebellion in as many sessions.

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.

BA ended up on the session by 2.7% at $252.00, setting a new 52-Week high today.