economy
Options investors are betting on this trend in gold prices, Susquehanna says
Gold is seeing muted volatility, firmer upside skew and renewed inflows.
TL;DR
- Options investors are showing increased interest in further upside in gold prices.
- One-month implied volatility for gold remains near recent lows.
- This environment allows investors to increase upside exposure without paying for higher volume.
- Gold funds are experiencing their strongest inflows since January.
- The skew in gold options has shifted from downside puts to upside calls.
- A specific trade involved the purchase of 8,000 November 460 calls on the SPDR Gold Trust.
- Another trade saw the purchase of approximately 25,000 Sep. 350 puts at a cheaper price for downside protection.