Bulls score again in $QCOM

Option traders posted large gains on upside positions in Qualcomm (QCOM) today for the second time in three sessions.

On Nov. 6, Market Rebellion’s activity scanners identified the purchase of 3,000 February $85 calls in one print for $5.55 with shares at $84.83. This was clearly a new position, This was clearly fresh buying, as open interest in the strike was only 660 contracts before the activity appeared.

Those calls traded for as much as $10.25 today, nearly twice their purchase price. The stock rose 8.79% in the same time frame, illustrating the kind of leverage that can be achieved with options.

It is the second winning trade in the name posted on Market Rebellion since Nov. 7.

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.

QCOM reached a session high of $92.52 just before noon ET but is now off 2.25% to $91.91. The chip maker topped quarterly results and issued a positive outlook after the market closed yesterday.