$AMGN bulls triple money in a day

Bullish option traders collected fast profits in Amgen today.

Just yesterday, Investitute’s proprietary programs flagged the purchase of 4,800 May $172.50 calls for $0.15 to $0.45 with shares at $169.75. This was clearly fresh buying, as open interest in the strike was only 1,001 contracts before the trades occurred.

Those calls sold for as much as $1.13 this morning, more than 3.5 times their average purchase price. The stock rose 1.26% at the same time, 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 retreats but also carry less risk than owning the shares themselves.

AMGN reached a session high of $172.02 this morning but pulled back with the broader market late in the afternoon to close at $169.92, still up 0.89% on the day. Shares rose after the drug maker released early-stage trial data on its KRAS oncogene treatment for tumors in lung-cancer patients.