Bulls triple their money in $BSX

Boston Scientific bucked the overall market downtrend today, yielding exponential gains on upside option positions.

On May 21, Investitute’s tracking systems detected the purchase of 5,200 August $31 calls for $1.22 to $1.35 with shares at $30.64. These were clearly new positions, as open interest in the strike was only 657 contracts before the activity appeared.

Those calls sold for $4 today, 3 times their purchase prices. The stock rose 14.33% in the same time period, illustrating the kind of leverage that can be achieved with options. Investitute co-founder Pete Najarian cited even more buying in September $36 calls on CNBC’s “Halftime Report” today.

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.

BSX was up 3.53% to $34.89 today. The medical-device maker rallied along with other names in the health-care industry as investors turned to stocks with less exposure to international markets.