Some savvy traders are shopping for Abercrombie and Fitch shares.
Despite being down 24 percent year to date, the stock is surging this week, up more than 5 percent since Monday. And some options traders are betting on an even bigger rally to come in the next several weeks.
On Tuesday, when options call volume ran more than two times its volume, traders bet that Abercrombie shares could rise more than 15 percent by mid-July. Specifically, the traders bought the July 25-strike calls for 16 cents each. Since buying a call option allows a trader to purchase a stock at a given price for a set time, this trade is profitable if Abercrombie shares rise above $25.16 by July expiration.