Bulls score big win in $AMRN

Option traders more than doubled their money on upside positions in Amarin (AMRN) today.

On Oct. 10, our tracking systems detected the purchase of 10,000 November $17 calls in one print for $1.50 above open interest of 1,976 contracts with shares at $14.46. Market Rebellion co-founder Jon Najarian cited the unusual activity at that time on CNBC’s “Halftime Report.”

Those calls have traded for as much as $4 so far today, more than 2.5 times their purchase price. The stock rose 44% in the same time, a huge move but still well below that of its options on a relative basis.

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.

AMRN is up 22.35% to $20.69 in midday trading. Documents released by a Food and Drug Administration committee this morning said the pharmaceutical company’s fish-oil pill Vascepa has a “favorable benefit/risk profile” in cardiovascular treatments.