Bulls double money in hours in $SLCA

U.S. Silica Holdings (SLCA) has rallied sharply since reporting earnings, providing opportunity and yielding bullish option traders gains in just hours today.

Just this morning, Investitute’s market scanners flagged the purchase of 3,000 August $14 calls in one print for $0.60 above open interest of 438 contracts with shares at $13.53.

Those calls have today traded for as much as $1.20, twice their purchase price. The stock rose 9.46% in the same time period, a large intraday 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.

SLCA reached a session high of $14.83 today but has since pulled back, currently up 10.64% to $14.14. The commercial silica producer reported earnings yesterday before the opening bell, beating on both its top and bottom lines.