Bulls fly a second leg with $GOGO

Bulls who opened upside option positions in Gogo Inflight Internet (GOGO) on Wednesday are seeing their bets take flight today.

On Sep. 2, Market Rebellion’s Unusual Activity Scanners showed that 3,700 September $9 calls were bought for $0.40 to $1.25 with shares of $7.44. Volume was well above the strike’s previous open interest of 988 contracts, indicating that this was fresh interest.

Those calls traded for as much as $2.05 today, more than double their average purchase price. The stock rose 41.8% in the same time frame, illustrating how quickly options can far outperform their underlying shares.

It is the second winning trade in the name to be posted on Market Rebellion this week.

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.

GOGO was up 4.15% to $10.04 at the close. The in-flight broadband provider spiked to another new 52-Week high today of $10.68 after entering into an agreement to sell its Commercial Aviation business to Intelsat S.A. (INTEQ) for $400 million earlier this week.