$SYY bulls post quick gains

It took less than three sessions for option traders to double their money on upside positions in Sysco.

On May 3, Investitute’s proprietary programs flagged the purchase of 5,400 May $71 calls for $1.25 to $1.60 with shares at $70.80. Open interest in the strike was a mere 52 contracts before the activity appeared, showing that this was fresh buying.

Those calls traded for as much as $2.56 today, more than twice their initial purchase price. The stock rose 3.47% in the same time frame, illustrating the kind of leverage that can be achieved quickly 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.

SYY reached a session high of $73.38 this morning but pulled back with the rest of the market to close at $72.90, off 0.07% on the day. The food company’s quarterly revenues topped expectations yesterday.