$ASND calls score big gains

Bullish option traders have more than doubled their money in Ascendis Pharma (ASND).

On May 31, Investitute’s market scanners identified the purchase of 2,400 January $90 calls in one print for 10.50, with the stock 69.24. There was no open interest in the contract at the time, indicating that this was a new position.

Those calls were marked at $27.70 today, more than 2.5 times their purchase price. The stock surged 56.86% in the same time period, a huge move but still nowhere near 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.

ASND reached a session high of $109.24 this morning but is down 2.84% to $105.79 in afternoon trading. The biopharmaceutical company reached at 52-week high of $133.96 earlier this month but pulled back after its annual R&D Day yesterday.