$TECK option bulls mine for profits

Bullish option traders are mining profits in Teck Resources (TECK) calls today.

On Aug. 18, Market Rebellion’s Unusual Activity Service found that 4,450 January $23 calls were for $1.83 to $2.05 above the existing open interest of 1.166 contracts with shares at $21.46.

Those calls were last marked for $9.10, more than 4 times their purchase prices. The stock rose 49.86% at the same time, showing how quickly 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.

TECK was last up 3.08% to $32.16 in late day trade.