Caesars Entertainment has been battered by the market for much of the first quarter of this year. But in the past two days, the stock has rallied and some traders are placing bets the shares will go even higher.
After falling 33 percent since the start of the year, shares of the troubled casino saw a 10 percent bounce over the past four days. And on Tuesday, options traders threw their chips down on the table, betting Caesars will rally another 4 percent by the end of next week.
Tuesday's session saw heightened activity in the options market for the stock. Some 22,000 options were traded, about 4.4 times the average daily volume. The vast majority of those options, about 15,000, were calls. A call is a bullish wager giving the purchaser the right to buy a stock within a given time.
About half the calls traded Tuesday were the 10.50-strike calls expiring on April 10. A total of 7,653 of those contracts traded with an average price of around 50 cents, meaning the buyer is expecting Caesars to move above $11, or 4 percent higher within a week and a half. Since each contract controls 100 shares, the total amount paid for this trade was around $383,000.