Blue-Chip Bank Giant That is a Safe Play in July

GS could benefit from a shift in sentiment in the options pits

Deputy Editor
Jul 7, 2021 at 1:42 PM
facebook X logo linkedin

With a stellar first half of the year for Wall Street in the rearview mirror, investors are speculating on potential gains for the latter half -- and things are looking good. Bank stocks have attracted considerable attention of late, as volatile 10-year Treasury yield movements resulted in a recent selloff in the sector. However, this pullback may be the perfect opportunity to jump on Goldman Sachs Group Inc (NYSE:GS). Though the was last seen down 0.7%, trading at $367.22, it boasts a 84.4% year-over-year lead. In addition, GS is just one month removed from a June 7, all-time high of $393.26, and there's reason to believe that level could soon be within reach once again.

Digging deeper, Goldman Sachs stock just made it onto Schaeffer's Senior Quantitative Analyst Rocky White's list of the best performing stocks on the S&P 500 in July, going back 10 years. The security has seen positive monthly returns during this time period nine out of ten times, with a 4% pop on average. This means a move of similar magnitude from its current perch would put GS at nearly $382 -- leaving about 3% between the equity and its aforementioned all-time high. 

On the charts, Goldman Sachs stock is pacing for a fourth-straight loss. The last time the equity saw a similar streak of losses, it bounced off the $348 level -- which coincides with the 80-day moving average -- in mid-June, to subsequently climb above $380 by the beginning of July.


A shift in sentiment over in the options pits could create additional tailwinds for Goldman Sachs stock. This is per the security's 50-day put/call volume ratio at the International Securities Exchange (ISE), Cboe Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX), which sits in the 74th percentile of its annual range. In other words, long puts are being picked up at a faster-than-usual clip.

Echoing this, the equity's Schaeffer's put/call open interest ratio (SOIR) of 1.28, which sits higher than 84% of readings from the past year. This means short-term options traders have been more put-biased than usual. 

What's more, GS premiums are a bargain at the moment. The security's Schaeffer's Volatility Index (SVI) of 29% stands higher than 18% of readings in its annual range, suggesting options traders have rarely priced in lower volatility expectations during the past 12 months.


Target Effortless Triple-Digit Gains Every Sunday Evening For Life!

This is your chance to triple your profit potential on Sunday evenings, without spending all your free time watching the market.

On Sundays, as a Weekend Plus subscriber, you’ll get up to 6 trades every Sunday, each targeting gains of 200% or more.

Start targeting gains like the ones our subscribers have seen recently, including:

213.3% GAIN on AutoNation calls
100.0% GAIN on Monster Beverage calls
100.4% GAIN on Walgreens Boots Alliance puts
100.4% GAIN on ON Semiconductor calls
257.7% GAIN on Dell calls

101.0% GAIN on Apollo Global Management calls
103.6% GAIN on JP Morgan  Chase calls
105.3% GAIN on DraftKings calls
101.3% GAIN on Airbnb calls
203.0% GAIN on Shopify calls
102.0% GAIN on Cboe Global Markets calls
100.9% GAIN on Boeing calls
102.1% GAIN on Microsoft puts
102.3% GAIN on First Solar calls
101.5% GAIN on PulteGroup calls
101.0% GAIN on Apple calls
209.4% GAIN on NXP Semiconductors calls
100.8% GAIN on Uber Technologies calls
100.4% GAIN on Academy Sports and Outdoors puts
102.2% GAIN on Trade Desk calls
100.8% GAIN on DoorDash calls
100.0% GAIN on Camping World Holdings puts
100.0% GAIN on Cboe Global Markets calls
100.2% GAIN on calls
238.5% GAIN on Oracle calls



Rainmaker Ads CGI