Over the past week, investors have bought more than 37,000 calls at the January 20 strike price in Regions Financial, according to Jon Najarian, Najarian Family Office co-founder and "Halftime Report" contributor. These calls expire in just under a month, so it's a bet that Regions' stock will climb through $20 per share by the middle of January.
From Thursday's close of $17.49, shares would need to climb more than 14 percent to hit the 20 strike price over the next month. Najarian sees the passage of the GOP tax package as a potential catalyst to drive the Alabama-based regional bank "into the high teens" by the calls' January expiration.
Traders can use call options to capture potential upside in a stock while committing less capital upfront for the trade, as the price of each options contract is often less than the price of the stock. There is risk though, as an options contract does not equal ownership and can expire worthless.