$PLAN bulls double money

Option traders have logged large gains on upside positions in Anaplan (PLAN).

On Oct. 16, Market Rebellion’s Unusual Activity Service flagged the purchase of 10,700 December $42 calls for $6 as part of a bullish roll with shares at $43.79. Open interest in the strike was only 1 contract before the trade occurred, showing that this was a new position.

Those calls are marked at $12.40 today, more than twice their purchase price. The stock rose 23.8% 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.

PLAN is up 1.35% to $54.32 this morning. The cloud-technology company beat earnings and revenue estimates on Nov. 21.