Two words sum up the trading in Bank of America yesterday: fast money.
The financial behemoth opened higher, and the option action hit almost immediately as traders took positions in the short-term weekly calls that expire this Friday. OptionMonster's tracking systems show that activity was initially focused on the 12.50 calls, which were bought early for $0.10 to $0.12.
Those contracts lock in the price where the stock can be purchased, no matter how high it might rise. Because they are relatively inexpensive, the options can generate significant leverage if the stock moves.
And move it did.