$INTC call buyers turn big gains

Intel has provided several winning trades in the last month, and today was no exception.

On March 28, Investitute’s tracking systems showed that 10,000 Weekly $50 calls expiring on May 4 were purchased for $2.45 as part of a bullish spread with shares at $49.89. This was clearly a new position, as open interest in the strike was only 121 contracts before that session began.

Those calls traded for $4 today, a gain of more than 60%. The stock rose 6.7% at the same time, illustrating the kind of leverage that can be achieved with options. It was the fourth winning Intel trade posted on Investitute in as many weeks.

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.

INTC was up 3.17% to close at $52.72 today. The chip maker has been rebounding with other semiconductor leaders recently.