Traders keep winning in $CZR

It took just three sessions for bullish option traders to collect more profits in Caesars Entertainment.

On Jan. 9, Investitute’s proprietary programs found that 10,000 Weekly $9 calls expiring on Jan. 25 were purchased for $0.13 to $0.16 with shares at $7.77. This was clearly a new position, as open interest in the strike was a mere 30 contracts before the trade occurred.

Those calls sold for $0.32 this morning, more than double their purchase prices. The stock rose 11.7% in the same time frame, illustrating the kind of leverage that can be achieved with options. It was the second winning trade in Caesar’s posted on Investitute in less than a week.

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.

CZR slumped in the morning but rebounded to end the session unchanged at $8.75. The casino operator rallied on reports that billionaire Carl Icahn was building a stake in the company at the end of last week.