Bulls take a bite out of $AAPL

Bullish option traders that took a bite out of Apple (AAPL) have seen their bets pay off today, tripling after only being open for just over a week.

On Dec. 23, Market Rebellion’s Unusual Activity Service found that 8,300 Weekly $282.50 calls expiring on Jan. 3 were bought for $2.63 to $3.55 with shares at $280.96. Volume was well above the strike’s open interest of 4,364 contracts, indicating that this was clearly fresh buying.

Those calls traded for as much as $10.75 after the opening bell today, 3 times their average purchase price. The stock rallied 4.14% at the same time, a huge move but nothing like that of its options on a relative basis.

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.

AAPL was last up 0.23% on the session, at $292.20. The iPhone maker was noted by Wedbush analyst Daniel Ives this morning as the clear winner of the “5G Super Cycle” in 2020.