Bulls rev up quick profits in $HOG

Option traders quadrupled their money overnight in Harley-Davidson.

Just yesterday, Investitute’s proprietary programs found that 2,300 Weekly $43.50 calls expiring this Friday were purchased for $0.43 to $0.65 with shares at $41.81. Open in interest in the strike was a mere 171 contracts before the trades occurred, showing that this was fresh buying.

Those calls traded up to $1.88 today, more than 4 times their initial purchase price. The stock rose 8.23% at the same time, illustrating the kind of leverage that can be achieved quickly 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.

HOG jumped 7.67% to $44.63 today. The motorcycle icon beat earnings estimates this morning despite widespread concerns over trade tariffs.

(Disclosure: I am long HOG.)