Bulls double money in $MPC

Option traders are doubling their money in Marathon Petroleum (MPC) today.

On Feb. 4, our Unusual Activity tracking systems detected the purchase of 5,000 Weekly $55 calls expiring on Mar. 13 for $1.48 to $1.57 above open interest of 14 contracts with shares at $53.64.

Those calls have traded for as much as $4.25 so far today, more than 2.5 times their purchase prices. The stock rose 9.45% in the same time frame, showing how quickly options can far outperform their underlying shares.

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.

MPC is up 2.63% to $58.26 this afternoon. Shares are up sharply after Bloomberg reported this morning that Seven & I Holdings, the controller of 7-Eleven, is working with advisers to consider a takeover of Marathon’s Speedway division.