$WDC call prices trade higher

$WDC call prices trade higher

by

Bullish option traders are racking up big gains in Western Digital (WDC) this session.

On Oct. 31Market Rebellion’s Unusual Activity Service found that 13,800 February $50 calls were bought for $0.97 to $1.15 above the existing open interest of 102 contracts with shares at $40.04.

Those calls have traded for as much as $9.20 today, a 700% return, while the stock rose 46.23% at the same time, showing 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.

WDC was last trading at $57.00, up 4.07% on the session.

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