$QCOM bulls take 12-fold gains

Qualcomm continued its upward trajectory for a second session today, resulting in more exponential profits on upside option positions.

On March 1, Investitute’s proprietary programs flagged the purchase of 13,000 October $60 calls for $1.85 to $2.04 with shares at $54.12. This was clearly fresh buying, as volume was far above the strike’s existing open interest of 2,926 contracts.

Those calls sold for as much as $23 today, nearly 12 times their average purchase prices. The stock rocketed 52.4% in the same time period, a huge move but still nowhere near that of its options on a relative basis.

It is the second winning trade in the name posted on Investitute in as many sessions.

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.

QCOM was up another 12.25% today, on top of a 23.21% surge in the previous session. The chip maker, which reports earnings in the post-market on May 1, spiked higher yesterday after settling a major royalties dispute with Apple.