CNBC Stock Blog

Stock Option Traders Betting on Apple Rally


Apple's options got off to an early start yesterday and stayed busy until the close.

The weekly calls, which expire Friday, led the activity. More than 25,000 traded in the December 410s, with big trades pricing for $1.32 to $3.15, according to OptionMonster's real-time tracking systems. The December 405s were also active, with more than 13,000 contracts trading.

Long calls lock in the price that investors must pay to buy the stock, so if Apple has even a modest rally, they could double or triple. But they can also plunge just as easily if the stock declines or stands still.

AAPL closed the session up 0.79 percent at $406.53 and have been moving higher in the last week. Yesterday's volume really stood out, with more than 300,000 contracts changing hands compared with its daily average of 118,000. The heavy trading took place on a very slow session overall, with turnover in the broader market about 30 percent below average.

Total calls outnumbered puts by almost 2 to 1 in the name, a further reflection of the bullish sentiment.

Second Opinion: Buy Apple in 2012?

—Najarian owns AAPL shares.

Options Trading School:


Pete Najarian is a professional investor, CNBC contributor, regular co-host of CNBC's "Fast Money" and co-founder of .



Related Tags