Long callslock in how much investors must pay to buy a stock. That gives them major leverage to the share price, letting them double or triple their money from even a small move.
One problem that doesn’t exist with stock, however, is that options expire. So we often see rolls like yesterday’s as investors look to extend the duration of their positions.
Morgan Stanley's stock fell 1.22 percent to $20.26 yesterday, but is up 34 percent year to date. The company got a boost on Jan. 19 after reporting strong earnings and revenue.
More than 60,000 option contracts traded in the name yesterday. Of those, almost 45,000 were calls, a reflection of the bullish sentiment.
—Najarian owns MS shares.
Additional News: Morgan Stanley ‘Shoe Lady’ Tries on Something New
Additional Views: Morgan Stanley—Cramer’s Best Play on Facebook
Options Trading School:
Pete Najarian is a professional investor, CNBC contributor, regular co-host of CNBC's "Fast Money" and co-founder of OptionMonster.com.