Option traders are racking some up quick profits in the hard-drive space today after Seagate Technology raised its guidance.
On Monday, some traders bought the Weekly 32 calls expiring this Friday for just $0.23 to $0.30. The shares then moved higher and those calls more than tripled, fetching as much as $1.02 today.
This kind of pop is common in the world of weekly options , short-term instruments specially tailored to quick trades in highly liquid names. Weeklies have grown increasingly popular in recent years as investors eschew longer time frames in exchange for greater leverage.
STX, for instance, is up less than 4 percent since those calls were purchased on Monday, but those Weekly 32s have moved more than 70 times as much on a percentage basis. If the stock hadn't rallied or fallen, however, these options would be close to worthless.
Given the kind of gains they can produce, optionMONSTER has created this special page to track weekly options. Checking it frequently can help traders identify stocks that are ready to make quick moves higher or low.
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