The bulls pounced on Hecla Mining yesterday, and the silver company didn't disappoint them.
OptionMonster's tracking systems detected heavy buying in the January 6 calls for $0.50 early in the session. The stock climbed throughout the day, ending with a 9.20 percent gain at $6.53. The calls went along for the ride and fetched as much as $0.91 in the final hour of trading.
By the time the dust settled, more than 77,000 changed hands against open interest of just 7,027 contracts. There was also buying in the January 7.50 calls for $0.24 to $0.26, but volume was below previous positioning in that strike.
Long calls such as these lock in the entry price that investors must pay to get into a stock. That means their premiums can rise dramatically from a small move in the share price or become worthless if the stock fails to move or experiences a slight decline.
Total option volume in the name was 15 times greater than average yesterday, with calls outnumbering puts by 11 to 1.
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David Russell is a reporter and writer for OptionMonster.