Weekly calls are popular on GS
Bank stocks are having a strong session after U.S. financial institutions passed their stress tests from the Fed. One winner is Goldman Sachs Group Inc (NYSE:GS), who is set to close atop the 200-day moving average for the first time in over a year, last seen trading up 2.4% at $204.12. This price action has sparked interesting GS options trading, too.
More than 48,000 options have traded, doubling the daily average, and much of this activity is centered at the soon-to-expire weekly 6/28 205-strike call. Others are opening at the weekly 7/5 210-strike call, likely trying to profit on extended upside through expiration at next Friday's close.
Goldman Sachs actually has fairly high volatility expectations surrounding it today, based on its 30-day at-the-money (ATM) implied volatility (IV) of 26%, which ranks in the 70th annual percentile. Over the past year, the security hasn't really surpassed options traders' volatility expectations, since its Schaeffer's Volatility Scorecard (SVS) is at a middling 49 out of a potential 100.