Vertex call spread eyes big gains in drug maker’s shares

JPMorgan Chase & Co. (NYSE:JPM) – Weekly call buying on JPMorgan Chase & Co. (NYSE:JPM) in the first hour of the trading session suggests some traders anticipate shares in the name will extend gains in the near term. Shares in JPMorgan Chase & Co. (NYSE:JPM) are up better than 2% at present to trade at $42.35 as of 11:35 a.m. ET. The stock has increased roughly 30% during the past six months. Call options with five full trading sessions remaining to expiration were most active at the Dec. 14 ’12 $42.5 strike in the early going, with 2,800 contracts in play versus open interest of 94 positions. Time and sales data indicates the bulk of the $42.5 strike weekly calls were purchased for an average premium of $0.35 apiece. Call buyers may profit at expiration next week should shares in JPMorgan Chase & Co. (NYSE:JPM) rally another 1.2% to exceed the average breakeven price of $42.85. Shares in JPM last traded above $42.85 in the first full week of November.

Caitlin Duffy

Equity Options Analyst

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