Options News
$GILD bulls double their money in days
It took only three sessions for bullish option traders to rack up healthy gains on short-term upside positions in Gilead Sciences (GILD) On Apr. 27, Market Rebellion’s Unusual Activity Service found that 4,000 Weekly $81 calls expiring on May 1 were bought for $2.25 to $2.27 as part ofa bullish spread with shares at $78.87. […]
It took only three sessions for bullish option traders to rack up healthy gains on short-term upside positions in Gilead Sciences (GILD)
On Apr. 27, Market Rebellion’s Unusual Activity Service found that 4,000 Weekly $81 calls expiring on May 1 were bought for $2.25 to $2.27 as part ofa bullish spread with shares at $78.87. This was clearly fresh buying, as open interest in the strike was only 368 contracts before that session began.
Those calls traded for as much as $5.20 so far today, more than 2 times their purchase prices. The stock rose 7.37% in the same time frame, underscoring how quickly options can far outperform their underlying shares.
It is the second winning trade in the name to be posted on Market Rebellion this month.
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.
GILD was last up on the session by 7.72% to $84.74. The pharmaceutical giant rallied on a report this morning that the NIAID study of its remdesivir as a COVID-19 treatment met the primary endpoint.