$MOS bulls score big on quarter

Option traders doubled their money in Mosaic today.

On Dec. 12, Investitute’s proprietary programs cited the purchase of 5,000 March $25 calls for $1.22 to $1.50 with shares at $24.75. Volume was well above the strike’s open interest of 3,961 contracts, indicating that this was fresh buying.

Those calls traded for $2.60 today, more than twice their original purchase price. The stock rose 10.4% in the same time period, underscoring how 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.

MOS jumped 5.23% to $26.76 today. The fertilizer company rallied after beating fourth-quarterly earnings and revenue estimates.