$BB bulls double their money

Option traders raked in substantial profits in BlackBerry today.

On Feb. 23, Investitute’s tracking systems detected the purchase of 3,674 April $12.50 calls for $0.76 and $0.77 in a sweep along with several March contracts as shares traded at $12.09. This was clearly a new position, as open interest in the strike was only 512 contracts before the activity appeared. Investitute co-founder Pete Najarian cited the unusual activity at that time on CNBC’s “Halftime Report” and updated that position this afternoon.

Those calls traded for $1.38 today, almost twice their original purchase price. The stock rose 10.7% in the same time frame, illustrating the kind of leverage that can be achieved with options.

Separately, on Feb. 14, Investitute found that 2,600 Weekly $11.50 calls expiring this Friday were bought for $0.85 to $0.94 above open interest of 260 contracts, with shares at $11.92. Those calls rose to $1.79 today, also doubling their original price, while the stock rose 12.2%.

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.

BB was up 2.83% to $13.08 today. Shares began rallying after the market closed yesterday on news that BlackBerry will provide security software for Microsoft Office apps used on smartphones, including Excel, Word, and PowerPoint.