Bulls double money in $MDT

Option traders racked up big gains today on upside positions in Medtronic (MDT) for the second session in a row.

On Sept. 4, Market Rebellion’s activity scanners identified the purchase of 5,000 October $110 calls for $1.59 as part of a bullish spread with shares at $107.85. This was clearly a new position, as open interest in the strike was only 1,605 contracts before that session began.

Those calls traded for as much as $3.15 today, about twice their purchase price. The stock rose 3.57% in the same time frame, illustrating the kind of leverage that can be achieved with options.

It is the second winning trade in the name posted on Market Rebellion in as many days.

Long calls lock in the price where a stock can be purchased, gaining with a rally and providing leverage to the underlying shares. The contracts can quickly lose value if the stock stalls or pulls back but also carry less risk than owning the shares themselves.

MDT is up 1.15% to $111.26 this morning. The medical-device maker has rallied sharply since holding support at the end of August.