HSBC, Royal Bank of Canada Agree to $10 Billion Sale

Calls are red-hot right now

Deputy Editor
Nov 29, 2022 at 9:49 AM
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British bank HSBC Holdings plc (NYSE:HSBC) just inked a deal to sell its Canadian unit to the Royal Bank of Canada (RY) for roughly $10 billion in cash. In recent years, HSBC has made efforts to improve profits, and this latest move could give shareholders a potential bumper payout.

Shares of HSBC stock are 4.2% higher out of the gate, and were last seen trading at a nearly three-month high of $30.60. Additionally, the equity is pacing for its first close above its 120-day moving average since mid-August. Year-over-year, HSBC is up 9%. 

The equity's Schaeffer's put/call open interest ratio (SOIR) of 1.14 ranks in the low 4th percentile of annual readings, indicating short-term options traders have been more call-biased than usual. 

Traders looking to get in on the bullish bandwagon could do so for a bargain. HSBC stock's Schaeffer's Volatility Index (SVI) of 27% stands in the relatively low 22nd percentile of readings from the past year, meaning low volatility expectations are being priced in at the moment. Even better, HSBC's Schaeffer's Volatility Scorecard (SVS) ranks at 82 out of 100, indicating the security tends to outperform said volatility estimates. 


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