Options Investors Turn Bullish on Gold

Nov. 15, 2011 - PRLog -- Gold options investors are placing bullish bets on the future price of gold. Calls to buy the SPDR gold trust has increased over puts to sell gold 1.5 to 1 in the past week, the highest level since August 8. The ratio has increased 6.5 percent in the past month with most options investors hedging for a 28 percent price increase in the price of gold.

The jump in activity around gold and gold coins corresponds with a more than 30 percent increase in the VIX market index which measures volatility. The increase in the VIX index last week was the steepest move in the past three months.

Investors are concerned that continued economic turmoil in Greece and Italy threaten the global markets. Experts believe that new rounds of money printing stimulus may be forcing the global economy toward financial crisis.

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