Bulls mining for gains in $FCX

Option traders are mining for gains in upside positions in Freeport-McMoRan (FCX) today.

On Sep. 1, Market Rebellion’s Unusual Activity Scanners showed that 18,640 January $17 calls were bought in one print, as part of a bullish roll, for $1.71 above open interest of 9,301 contracts with shares of $16.09.

Those calls traded for up to $11.50 today, over 6.5 times their purchase price. The stock rose 83.16% in the same time frame, underscoring how 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.

FCX was up 4.53% to close at $28.37. The mining company’s price target was raised to $30 from $26 this morning at B. Riley Securities, while Argus upgraded the name to Buy from Hold.