Those calls (learn more) lock in the price investors must pay to buy the stock, so they can generate significant leverage in the event of a rally. But they’ll expire worthless if the shares don’t move.
Abbott Labs shares rose 0.44 percent to close at $65.75. It has a $103 billion market capitalization (learn more) and is valued at 13 times forward earnings. The pharmaceutical company has 20 drug candidates in Phase 2 or Phase 3 clinical trials to drive growth.
Almost 25,000 calls traded versus fewer than 8,000 puts yesterday, a reflection of the session’s bullish bias. Total option volume was more than six times greater than average, according to our data systems.
—By CNBC Contributor Pete Najarian
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Pete Najarian is a professional investor, CNBC contributor, regular co-host of CNBC’s “Fast Money” and co-founder of OptionMonster.com. Najarian has no positions in ABT.