Banks are rallying as rates rise, and some traders are betting one name in particular will see big gains.
In the past two months, the KBW Bank index has soared 11 percent while the S&P 500 is down almost 1 percent. Helping to drive enthusiasm for banks has been the rebound in interest rates. The yield on the benchmark U.S. 10-year note has gone from 1.9 percent to 2.4 percent over the past 60 days. Bank profits are believed to benefit from higher interest rates.
Some traders are particularly looking at the nation's second largest commercial bank, Bank of America, to see a bullish move ahead of its expected quarterly earnings report release in July.
On Wednesday, options trades in Bank of America were 1½ times average daily volume. A lot of that volume came from bullish bets on the stock.