$GOOGL bulls score big on earnings

Option traders nearly doubled their money in Alphabet options that were purchased yesterday afternoon.

Just yesterdayInvestitute’s market scanners identified the purchase of 900 September $1,250 calls for $27.50 as part of a bullish roll with shares at $1,206.27. This was clearly a new position, as volume was above the strike’s open interest of 253 contracts.

Those calls traded for as much as $54.50 today, just shy of twice their purchase price. The stock rose 5.52% in the same time, underscoring how options can far outperform their underlying shares.

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.

GOOGL peaked at an all-time high of $1,275 this morning before settling back to close at $1,258.15, up 3.89% on the session. Alphabet reported stellar earnings last night with paid clicks up 58% year-on-year, triggering a slew of analyst upgrades.

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