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☆ This trade can hedge against a spike in volatility as election nears, Goldman says
▼ + stars: | 2024-09-23 | by ( Jesse Pound | In Jesse-Pound | ) www.cnbc.com time to read: +2 min

The CBOE Volatility Index , or VIX, fell below 16 on Monday and is now flirting with its lowest level since the July doldrums. "Our historical study of volatility shows that the VIX averaged 22 points in October, 4 points above the current VIX level. We believe the low implied volatility, upcoming October earnings season and elections provide an attractive opportunity for investors to hedge a potential rise in volatility," the note said. The options would have a strike price of 18 and expire in November, serving as a bet that expectations of volatility will rise as the election nears. There are no additional losses on the trade if the VIX actually declines instead.

Persons: Goldman Sachs, Arun Prakash, Prakash, VIX, seasonality Organizations: U.S

☆ Volatility looms as election season heats up. Fortify your portfolio against autumn market shocks
▼ + stars: | 2024-09-19 | by ( Darla Mercado | Cfp | ) www.cnbc.com time to read: +6 min

Recalibrate for risk Protecting your portfolio from sharp losses begins with understanding your comfort with risk and ensuring that your asset allocation reflects your long-term goals. "But over that period when markets were down, there were opportunities to harvest losses in stocks, individual names that experienced big pullbacks." And they've been a good buy for clients who are nearing retirement, seeking income and appreciate bonds' ability to offset stocks' volatility. Options for buffering losses Options are also playing a role in investors' portfolios as financial advisors try to mitigate volatility. Call options give investors the right to buy a stock at a specified strike price before a certain date.

Persons: Stocks, Goldman Sachs, Arun Prakash, Prakash's, Rafia Hasan, San, Hasan, they've, Andrew Herzog, We're, Herzog, he's, Gregory Guenther, Morningstar, " Guenther Organizations: Federal, Wealth Management, Fed, Treasury Bond ETF, SEC, GrantVest Financial Locations: San Francisco, Plano , Texas, Matawan , New Jersey

☆ Goldman is making a big call to clients to hedge for a market decline. Here's what it recommends
▼ + stars: | 2024-03-15 | by ( Jesse Pound | In Jesse-Pound | ) www.cnbc.com time to read: +3 min

Arun Prakash from Goldman's derivatives research team proposed an options trade focused on the Cboe Volatility Index , or "Vix," to hedge against a market selloff. .VIX 5Y mountain The Cboe Volatility Index has been trading at an unusually low level in 2024 so far. Generally speaking, a call option gives the holder the right to buy the underlying asset at the strike price, and serves as a bet that the asset will rise above the strike price. "Over the past 30+ years, VIX has averaged 19 in April, and we see upside risks to the current low VIX levels given current macro environment and upcoming macro/micro catalysts. If the Vix does not rise above the strike price before the options contract expires, the trader loses the premium paid for the contract.

Persons: Goldman Sachs, Arun Prakash, Prakash, hasn't, That's, Goldman, VIX, — CNBC's Michael Bloom Organizations: Reserve

☆ Goldman thinks oil is headed higher again and recommends an options trade to profit from the rebound
▼ + stars: | 2023-11-16 | by ( Spencer Kimball | ) www.cnbc.com time to read: +1 min

The recent pullback in crude has made call options on U.S. oil an attractive hedge against continued geopolitical and inflation risks that could push prices higher, according to Goldman Sachs. The investment bank recommends buying a $71 United States Oil ETF call for April 2024 to profit from a jump in prices. Investors would see an estimated return of 90% if WTI hits $88 a barrel by April, according to Goldman. The implied volatility in oil prices rose significantly in October due to the Israel-Hamas war, but option prices have since fallen and are now below the 1-year average. For equity investors, call options on S & P Oil & Gas , Energy Select Sector SPDR , Occidental and ConocoPhillips are the most attractive ahead of the OPEC meeting, according to Goldman.

Persons: Goldman Sachs, Goldman, Arun Prakash Organizations: West Texas, United States Oil, . Oil Fund ETF, P Oil & Gas, Energy, ConocoPhillips Locations: Israel, Occidental

☆ Goldman says the stock market is about to go on a wild ride and suggests a trade to capitalize on the volatility
▼ + stars: | 2023-09-18 | by ( Sarah Min | ) www.cnbc.com time to read: +2 min

Goldman Sachs expects the stock market is about to get even bumpier from here — and recommends ways for investors to capitalize on the turbulence. "We expect volatility to increase over next few weeks," John Marshall, head of derivatives research at the firm, wrote Monday. While the CBOE Volatility Index, or VIX, a popular measure of volatility, is down about 35% in 2023, the Wall Street firm expects that a deteriorating macroeconomic backdrop and seasonal volatility will drive it up. The CBOE Volatility Index was last hovering around 14. "Buy CBOE Volatility Index (VIX) Oct monthly expiry $15 calls to hedge potential rise in volatility," the firm's Arun Prakash wrote in a Thursday note.

Persons: Goldman Sachs, John Marshall, Marshall, Arun Prakash, Prakash, CNBC's Michael Bloom

☆ Goldman sees increased risk of a drawdown in tech stocks and tells clients to use this hedge
▼ + stars: | 2023-07-25 | by ( Jesse Pound | In Jesse-Pound | ) www.cnbc.com time to read: +1 min

It's time for investors to hedge their bets on tech stocks after a dramatic rally through the first half of the year, according to Goldman Sachs. Arun Prakash from Goldman's derivatives research team said in a note to clients on Tuesday that tech stocks look wobbly and could be due for a pullback. "Our analysis suggests that S & P Technology stocks have become unusually crowded relative to macro assets, and we see increased risk of downside asymmetry. Put options give the holder the right to sell an asset at a pre-determined strike price, and a put option is out of the money when the strike price is below the asset's current market price. The fund does not hold some of the other Big Tech names, including Meta Platforms and Alphabet .

Persons: Goldman Sachs, Arun Prakash, Goldman's, Goldman, CNBC's Michael Bloom Organizations: P Technology, Technology, Apple, Microsoft, Nvidia, Big Tech, Meta

☆ Goldman Sachs lays out its strategy for profiting with stocks, bonds, and options in 2023 despite a rocky year — and why investors shouldn't make any big strategy changes
▼ + stars: | 2023-01-16 | by ( Marley Jay | ) www.businessinsider.com time to read: +5 min

Goldman Sachs says 2023 should be a decent year for stocks even if there's a recession. The firm's investment strategy group discussed its multi-asset views this week. The simultaneous nosedive in stocks and bonds last year doesn't debunk the theory behind the traditional 60-40 portfolio, according to Goldman Sachs. But Sharmin Mossavar-Rahmani, the head of the Investment Strategy Group (ISG) at Goldman Sachs, says that it's not that unusual for stocks and bonds to move in the same direction. In fact, he noted that if a recession begins and ends in 2023, stocks may not have a bad year.

☆ Goldman Sachs breaks down an options trading strategy with an 18-year track record of adding income to investors' portfolios — and recommends making these 4 trades now
▼ + stars: | 2022-11-11 | by ( Morgan Chittum | ) www.businessinsider.com time to read: +3 min

As markets weather volatility, the investment bank recommends options trades with these 4 stocks. In a recent note to clients, Goldman Sachs breaks down this options trading strategy that the investment bank says has an 18-year track record of adding extra income to investors' pockets. Goldman Sachs Global Investment Research"These strategies have become increasingly popular among investors, especially given the prospects of flat to negative equity markets. For short-term overwriting options trades, the note focuses on three factors when choosing an "attractive" stock: events, implied volatility, and market cap of the company. "We have found that overwriting stocks with these characteristics has added over 500 bps over the past 16 years," the note said.

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