$AFL bulls triple their money

Aflac (AFL) is trading to a new 52-Week high today, handing sizable profits to upside option traders.

On Feb. 18, Market Rebellion’s UOA service showed that 18,900 May $50 calls were purchased as part of a bullish spread for $1.40 to $1.45 with shares at $47.46, above the previous open interest of just 3,572 contracts.

Those calls have sold for as much as $4.90 so far this morning, at least 3 times their purchase prices. The stock rose 149.58% in the same time period, illustrating the kind of leverage that can be achieved with options.

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.

AFL was last higher on the day by 0.58% at $55.22, setting new 52-Week highs this session for the insurance provider.