$NFLX bulls double money overnight

Bullish option positions opened in Netflix (NFLX) yesterday are rallying today as shares notch back above their 50-Day simple moving average..

Yesterday on Mar. 22, Market Rebellion’s Unusual Activity Service found that 2,900 Weekly $530 calls were bought for $2.60 to $7.49 with shares at $514.62. This was clearly fresh buying, as open interest in the strike was only 749 contracts before the activity appeared.

Those calls traded for as much as $15.10 today, more than double their purchase price. The stock rose 5.53% in the same time frame, illustrating the kind of leverage that can be achieved with options.

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.

NFLX ended the session up by 2.29% at $535.09. Argus upgraded shares to a Buy from Hold this morning.