$GOLD calls double overnight

Option traders are racking up profits today on upside positions opened in Barrick Gold (GOLD) only one session earlier.

Just yesterday, Our proprietary programs flagged the purchase of 5,000 October $24 calls for $0.12 with shares at $19.41. Co-founder Pete Najarian cited the unusual activity at that time on CNBC’s “Halftime Report.”

Those calls traded up to $0.24 today, twice their purchase price. The stock rose 3.19% at the same time, showing how quickly options can far outpace gains in 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.

GOLD is up 0.91% to $19.95 in afternoon trading. The miner has rallied sharply with the price of gold in recent months.