$CLVS bulls score big overnight

Option trades opened yesterday seeking short-term upside in shares of Clovis Oncology ripped higher today.

Minutes before the closing bell yesterday, Investitute’s proprietary programs flagged the purchase of 1,900 October $30 calls for $0.43 to $0.60 as part of a bullish roll with shares at $27.49. This was clearly a new position, as volume was above the strike’s existing open interest of 402 contracts.

Those calls traded sold for $2.50 today, five times their average purchase price. The stock surged 11.39% in the same time period, a huge move but still nowhere near 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.

CLVS spiked higher by 9.66% to $30.53 today. The anti-cancer focused biopharmaceutical company rebounded higher today after reaching lows not seen since November of 2016.