$AUPH call buyers strike again

Bullish option traders are once again logging big profits in Aurinia Pharmaceuticals (AUPH) for the second day in a row.

Just yesterday on Dec. 4, Market Rebellion’s Unusual Activity Service flagged the purchase of 10,000 January $10 calls for $3.00 as part of a bullish spread and roll, from a previously winning trade, with shares at $8.23. Open interest in the strike was only 4,284 contracts before the trade occurred, showing that this was a new position.

Those calls have traded for as much as $7.00 so far this morning, more than 2 times their purchase price. The stock soared 99.51% in the same time frame, a huge overnight move but still one that was dwarfed by 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.

AUPH made a new all-time high this morning at $16.82 but has since pulled back to trade at $15.16, still up 85.94% on the session. The late clinical stage biopharmaceutical company announced yesterday after the closing bell that its pivotal AURORA Phase 3 trial of voclosporin had seen positive efficacy and safety results.