Calls lock in the price investors must pay for the stock, which gives them major leverage on a percentage basis in the event of a rally. Should the shares fail to move, however, those options will expire worthless.
BMC shares rose 0.65 percent to $38.75 yesterday. The corporate software maker has been trying to work its way higher since early January, but remains trapped below its 200-day moving average. Management raised earnings guidance on Feb. 1, attracting buyers to the stock.
Overall option volume in the name was 19 times greater than average in the session. Calls outnumbered puts by 44 to 1.
—Neither Russell nor Najarian has a position in BMC.
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David Russell is a reporter and writer for OptionMonster.