$MSFT bulls score macro profits

Bullish option traders have been rewarded with fast profits on upside positions in Microsoft (MSFT).

On Jun. 5, Market Rebellion’s Unusual Activity scanners identified the purchase of 25,000 Weekly $190 calls expiring this Friday, Jun. 12, for $0.48 to $1.35 with shares at $183.41. This was clearly a new position, as volume was clearly above the strike’s previous open interest of 6,026 contracts.

Those calls have traded for as much as $6.77 thus far this session, at least 5 times their purchase prices. The stock rose 7.01% in the same time frame, showing how options can far outperform their underlying shares on a relative basis.

This is the second winning trade in the name to be posted by Market Rebellion in just over the last 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.

MSFT opened with a gap higher to a new all time high and was last trading at $196.02, up 3.28% on the session. The software giant has risen sharply since its recent lows.