The Biggest Commodity Option Bets for 2019
The option open interest landscape can provide insight into some of the thinking and views of option market participants. The January edition of Societe Generale’s Commodity Compass publication looks at the largest option strikes in terms of open interest for 29 different commodities over 2019.
The aim being to provide a rough framework of potential price expectations for the year, as well as an idea of where the largest open interest clusters lie. Volatility often increases at these levels, due to delta hedging. From a speculative perspective, strike prices with significant open interest can provide information on potential price risk scenarios, and from a hedging perspective, levels at which price risk is being managed.
SG Cross-Asset Research is composed of more than 200 Analysts, Strategists, Economists and Quant, combining their expertise into ‘Research-based’ and innovative solutions suited to client’ needs: fundamental studies and expert views, investment ideas and long-term strategies, trade ideas and tactical baskets, thematic and systematic indices, quant solutions. On top of its established UK and Western European base, SG Cross-Asset Research benefits from a global coverage thanks to its presence in the US and in Asia (Hong Kong, Singapore, Tokyo and Bangalore) and Societe Generale local networks in Eastern Europe.
Disclaimer
This editorial contains financial analysis which reflects the opinion of the Cross-Asset Research department of Societe Generale at the date of its publication. It does not necessarily reflect the views of the other departments of Societe Generale nor the official opinion of Societe Generale. This interview is dedicated to institutional and professional investors and is not deemed to be seen and used by retail investors for investment purpose. The viewers shall consult their own financial advisers to make their own appraisal.
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