$FB bulls continue to profit

Facebook hit a new all-time-high today, delivering further profits to bullish option traders.

On April 25, Investitute’s tracking systems detected the purchase of 4,000 July $175 calls for $3.70 in one print with shares at $160.26. This was clearly a new position, as volume was above the strike’s open interest of 3,705 contracts.

Those calls traded for $28.63 today, more than 7.5 times their initial purchase price, and 3 times more than their previous update, the day after that purchase. The stock rose 27% at the same time, a significant move, but nowhere near that of its options on a relative basis.

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.

FB jumped 2.4% to close at $203.23 today, just off its new all-time-high printed earlier in the session. The social network has had a strong move higher since its lows in April, shrugging off both trade war jitters and data-privacy issues.