The incredible longshot bet on airlines

Oil prices have been rising in the past two days but airline stocks are doing something surprising—they're rallying, too. And one trader is making a longshot bet that a major airline will see enormous gains in the next month.

Airlines stocks have benefited from the collapse in crude. In the last six months alone, the price of oil has fallen 32 percent while the NYSE ARCA Airline index is up 32 percent. But over the last few days, oil has bounced back in a big way yet airlines haven't sold off.

In fact, shares in airline stocks saw a little bit of a rally on Wednesday after Delta Air Lines reported earnings that beat Wall Street's expectations. Traders began making bullish bets on Delta's competitors as well, including United Continental Holdings, which saw four times its average daily call volume on Wednesday.

Among the calls bought in United, one trade stood out for being incredibly optimistic. A buyer went into the market and bought 10,000 of the May 95-strike calls for 5 cents each. Since each contract controls 100 shares, the trader paid $50,000 with the hope that United will move 56 percent higher from Wednesday's close in the next month.

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To put it in perspective, that's more than United's 12-month return. And it's equal to the stock's move from its mid-October lows to its January all-time highs of $74.52. But since a call is a bullish bet giving its purchaser the right to buy a stock at a set price by a given date, the trader in this particular transaction has a shorter amount of time for the stock to be in the money.

However, the trader may have been making such a long-shot bet in hopes United makes a big move, even if it doesn't trade up to $95.

"The options price should only move 1 cent for every dollar move higher in the stock," said Dan Nathan, co-founder of RiskReversal.com.

United Continental is expected to report its earnings sometime next week, though no date has been set. Shares in the airline are down 7 percent this year.

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