$AAXN bulls quintuple money

Strong sales propelled bullish option positions in Axon Enterprise today.

On April 23, Investitute’s market scanners identified the purchase of 4,500 June $45 calls for $2.10 to $2.40 with shares at $42.99. These were clearly new positions, as open interest in the strike was only 445 contracts before that session began.

Those calls traded for $10.70 today, 5 times their initial purchase price. The stock rose 28.8% in the same time period, showing how 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.

AAXN surged 22.33% today to close at $54.62. The Taser manufacturer reported record revenues after the market closed yesterday.