Call buyers winning again in $Z

Bullish option traders doubled their money today in Zillow for the second time in less than a week.

On May 6, Investitute’s market scanners showed that 4,000 May $33 calls were bought for $2.70 to $2.85 with shares at $34.03. This was clearly fresh buying, as open interest in the strike was a mere 22 contracts before the trades occurred.

Those calls sold for $5.87 today, more than twice their purchase prices. The stock rose 14.28% in the same time frame, illustrating the kind of leverage that can be achieved quickly with options.

It is the second winning trade in the name posted on Investitute in the last four sessions.

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.

Z was up 4.5% to $38.56 today. The real-estate company topped earnings expectations after the market closed on May 9, and this morning Guggenheim upgraded the name to “buy” from “neutral” while maintaining a $45 price target.