Bulls triple their money in $IPG

Interpublic Group has been clawing its way higher for more than a month, and option traders are reaping rewards for their patience.

On Aug. 24, Investitute’s market scanners cited the purchase of 10,000 October $21 calls in one print for $0.35 with shares at $19.81. This was clearly a new position, as open interest in the strike was just 1 contract before the trade occurred.

Those calls traded for $1.01 late this afternoon, nearly triple their purchase price. The stock rose 8.3 percent in the same time frame, underscoring the type of leverage that can be obtained with options.

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.

IPG was up 2.01 percent to $21.30 today. The advertising and marketing firm has been grinding higher since those October calls were bought just off the stock’s 52-week lows.