$AR bulls double their money

Option traders posted sizable gains in Antero Resources (AR) today after strong quarterly results.

On Oct. 9, Market Rebellion’s proprietary programs flagged the purchase of 2,000 February $4 calls in one print for $0.25. Shares were trading for $2.49 at that time.

Those calls traded for as much as $0.50 today, twice their purchase price. The stock rose 34.54% in the same time frame, a large move but still well below that of its options on a relative basis.

Long calls lock in the price where investors can buy a stock, letting them position for a rally at limited cost with the potential for significant leverage. They carry less risk than owning shares because the most that can be lost is the price of the options no matter how far the stock might fall.

AR reached a session high of $3.38 this morning but pulled back to close at $2.70, down 4.93% on the day. The oil and natural-gas company’s revenues surpassed expectations after the market closed yesterday.