Quick chips for $AMD option bulls

Bullish option traders who opened upside call positions in Advanced Micro Devices (AMD) yesterday are making big gains today as shares continue to climb.

On Nov. 2, Market Rebellion’s Unusual Activity Service found that 14,700 Weekly $127 calls, expiring this Friday, were bought for $1.35 to $1.79 above open interest of 8,714 contracts with shares at $124.87.

Those calls traded traded for as much as $3.98 this session, over 2 times their purchase prices. The stock rose 4.56% 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.

AMD was up by 2.27% to $130.53 at the close.