Bulls triple their money in $ARRY

Traders pocketed significant profits in Array Biopharma today.

On Nov. 14, Investitute’s market scanners identified the purchase of 5,000 March $12 calls in one print for $1 with shares at $10.37. This was clearly a new position, as open interest in the strike was only 755 contracts before the trade occurred.

Those calls sold for $2.80 today, nearly 3 times their purchase price. The stock surged 34.6 percent in that time period, a large move but one that is still well below that of its options on a relative basis.

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.

ARRY was up 3.17 percent to $13.98 today. The biopharmaceutical company has been rallying since management presented at the annual J.P. Morgan Healthcare Conference late Monday.