Bulls quadruple money in $TRCO

Option traders have racked up exponential gains in Tribune Media.

On July 20, Investitute’s proprietary programs flagged the purchase of 5,000 January $35 calls in one print for $2.60 with shares at $32.45. There was no open interest in the strike before the trade occurred, showing that it was a new position.

Those calls sold for $9.80 today, nearly 4 times their purchase price. The stock rose 38.06% in the same time period, a huge move but still nowhere near that of its options.

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.

TRCO peaked at $45.11 this afternoon but closed at $44.81, off 0.38% on the session. Yesterday, Nexstar (NXST) announced that it would buy the media company for $4.1 billion.