Investors should buy bullish Apple options because the largest technology company by market value may gain on “strong” growth from iPad sales and rising demand for its products in China, Morgan Stanley said.

“Bloomberg” (http://www.bloomberg.com/news/2010-09-09/buy-apple-call-options-on-ipad-sales-boost-morgan-stanley-says.html?cmpid=yhoo) reports that Equity derivatives strategists Christopher Metli and Sivan Mahadevan recommended purchasing January US$280 calls while selling the same number of January $320 calls, a strategy known as a call spread that cuts the trade’s cost while capping potential profit.

Apple rose 2% to $262.92 yesterday to extend this year’s advance to 25%.