Bulls double their money in $ANF

Abercrombie & Fitch (ANF) has paid off on upside option positions today for bullish traders.

On Nov. 6, our Unusual Option Activity tracking systems detected the purchase of 10,500 December $16 calls for $1.30 to $1.60 above open interest of 39 contracts with shares at $15.84.

Market Rebellion co-founder Pete Najarian cited the unusual activity at that time on CNBC’s “Halftime Report.”

Those calls have traded for as much as $3.50 so far today, about twice their purchase prices. The stock rose 19.89% in the same time frame, 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.

ANF was last trading for $18.75, up 0.48% on the session. Quarterly results for the retailer are scheduled for Nov. 24 before the market opens.