$CLF bulls mine more profits

Bullish option traders are mining more profits in upside positions opened in Cleveland-Cliffs (CLF).

On Nov. 24, Market Rebellion’s Unusual Activity Service identified the purchase of 4,700 December $12.50 calls for $0.11 to $0.24 with shares at $10.31. This was clearly fresh buying, as volume was well above the strike’s previous open interest of 50 contracts.

Those calls traded for as much as $1.35 so far today, more than 5.5 times their purchase prices. The stock rose 33.37% in the same time frame, illustrating the kind of leverage that can be achieved with options.

This marks the second winning trade in the name to be posted on Market Rebellion this month.

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.

CLF is up 8.79% to $13.80 this afternoon, setting fresh 52-Week highs. B. Riley Securities raised its price target for the shares to $16 from $13 this morning.