Investors are digging for value in beaten-down gold stocks.

optionMONSTER's Heat Seeker monitoring program detected two bullish trades in the Market Vectors Gold Miners Fund, which has been languishing below its 2008 all-time low since late July.

The first transaction appeared within an hour of the opening bell, with 3,178 March 14 calls bought for $1.76 and an equal number of March 16 calls sold for $1.03. Volume was more than twice open interest at both strikes, which indicates that a new bullish call spread was initiated.

The strategy cost $0.73 and will earn 174 percent if GDX closes at $16 or higher on expiration. The long calls fix the price where the fund can be bought while short calls obligate the investor to sell if a given level is reached. Combining the two leverages a move of a specific size. (See our Education section)

The second trade was a variant of the vertical known as a ratio spread . An even 2,200 of the March 15s were purchased for $1.36 and 4,400 of the March 19s were sold for $0.48. It cost $0.40 and will earn 900 percent from a move to $19, but the investor is effectively short 220,000 shares above the higher strike price in the spread. This suggests that he or she already owns the fund and is using the strategy to leverage a rally and then exit completely.

GDX is down 2.33 percent to $13.42 in afternoon trading. It's struggled with weak bullion prices and bearish sentiment among metal stocks. Much of the negativity has also been tied to fears of an interest-rate hike by the Federal Reserve, so today's upside activity reflects hope that monetary policy will remain accommodative. (See related story on gold futures)

Total option volume in GDX is slightly above average so far today, with calls outnumbering puts by more than 3 to 1. The fund's top holdings include Goldcorp and Newmont Mining.


More From optionMONSTER

• Notable option activity in equities
  
• Citigroup gets bullish earnings play
  
• Videocast: Target 35 level in VIX