Bulls step on the gas with $GT

Option traders tripled their money in Goodyear Tire & Rubber today.

On July 23, Investitute’s market scanners identified the purchase of 2,000 August $21.50 calls in one print for $0.75 to $0.78 with shares at $21.40. There was no open interest in the strike before the trade occurred, showing that this was a new position.

Those calls sold for $2.90 this morning, more than 3.5 times their purchase prices. The stock rose 13.93% in the same time frame, underscoring 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.

GT jumped 4.19% to $24.12 today. The tire manufacturer’s second-quarter earnings surpassed expectations on Friday morning.