Bulls score with $MO at highs

Option traders scored more fast, big profits on upside positions in Altria (MO) today.

On Mar. 16, Our market scanners showed that 2,000 Weekly $50 calls, expiring this Friday, Mar. 26, were bought for $0.42 to $0.61 with shares at $49.34. This was clearly a new position, as open interest in the strike was a mere 599 contracts before the trade occurred.

Those calls traded this session up to $1.68, about 3 times their purchase prices. The stock rose 4.74% in the same time frame, showing how quickly options can far outperform their underlying shares.

This marks the second winning trade in the name posted on Market Rebellion in the last week.

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.

MO closed at $51.64, up 2.16% today, setting new 52-Week highs this session for rhe cigarette and wine company.