$AAPL bulls score at highs

Option traders are logging big profits on upside positions opened in Apple (AAPL) last month.

On Dec. 9, Market Rebellion’s Unusual Activity Service detected the purchase of 2,100 Weekly $135 calls, expiring today, Jan. 22, for $2.24 to $2.35 with shares at $124.59. This was clearly fresh buying, as open interest in the strike was just 923 contracts before the activity appeared.

Those calls traded for as much as $4.85 today, over 2 times their purchase prices. The stock rose 12.2% at the same time, underscoring how quickly 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.

AAPL closed up by 1.61% to $139.07 today, just shy of a new high of $139.85 made earlier in the session.