$MS call prices rocket 15-fold

It took just two sessions for option traders to rack up stratospheric gains on upside positions in Morgan Stanley (MS).

On Jan. 14, Market Rebellion’s Unusual Activity Service flagged the purchase of 5,800 January $56 calls for $0.06 to $0.09 with shares at $52.95. This was clearly fresh buying, as open interest in the strike was only 593 contracts before the activity appeared.

Those calls have traded for as much as $1.17 so far today, more than 15 times their average purchase price. The stock rose % in the same time frame, illustrating the kind of leverage that can be achieved with options.
56.87

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.

MS is up 7.19% to $56.75 this morning. The bank beat estimates on hte top and bottom lines this morning.