March 2025 Metals Options Update

Q1 2025 has been a standout period for gold, with prices surging 13% year-over-year. The metal has recently breached the historic $3,000 per ounce mark, driven by a combination of escalating geopolitical instability, inflationary concerns, robust central bank purchases and a weakening U.S. dollar. This upward trend has led to heightened volatility, with significant intraday price movements as investors turn to gold as a safe-haven asset.

While the average daily volume (ADV) of Gold (OG) options dipped to just below 50K contracts in March, open interest (OI) remained robust, exceeding one million lots. Although March’s ADV and OI fell short of the record highs seen in February, Q1 2025 has shown strong trading activity for Gold options trading. This trend is further reflected in the rising implied volatility (CVOL), which has seen recent spikes, signaling stronger bullish sentiment and increased market uncertainty. With volatility expected to persist, Gold options remain a crucial tool for risk management.

Earlier this quarter, we expanded the listing schedule for Gold (OG) options. Monthly contracts are now available for up to 22 consecutive months, with additional long-dated expirations added in June and December for the nearest 72 months for OG and 60 months for SO and HXE. This expansion allows market participants to respond dynamically to geopolitical shifts and economic data releases, providing greater flexibility in managing market risk. Gold options, available in both monthly and weekly formats, are accessible every trading day of the week.

Copper prices have surged 27% year-to-date, trading above five dollars per pound. This growth underscores copper's increasing importance in electric vehicles (EVs), power grids and infrastructure spending. The market is also on higher alert due to potential U.S. import tariffs on copper, which are expected to heighten price sensitivity.

We are proud to offer best-in-class screen liquidity for Copper (HXE) options, making us the only international exchange with a dedicated screen for these options. This has solidified our position as the venue of choice for investors and funds seeking exposure to copper.

Copper options have shown strong trading momentum in Q1 particularly in March, with an average daily volume (ADV) of 9,388 contracts and open interest (OI) of over 100,000 lots. This surge in activity is partly attributed to market speculation that the Trump administration may impose tariffs on copper imports into the United States, following recent 25% tariffs on steel and aluminum.

The enhanced liquidity and flexibility provided by our Copper options enable market participants to effectively navigate both short-term price fluctuations and long-term risks.

Platinum is stepping into the spotlight as its industrial applications expand beyond traditional automotive demand. Historically tied to catalytic converters for diesel vehicles, platinum is now a key material in renewable energy technologies. In March, platinum prices climbed above $1,000 per ounce, driven by the growing adoption of green energy solutions and sustained demand in the jewelry sector.

Meanwhile, global platinum supply remains constrained, adding to price uncertainty.

In March, Platinum (PO) options averaged over 1,000 contracts per day, marking a 21% year-over-year increase and contributing to a strong Q1 2025. Earlier this quarter, we introduced new Friday expirations for Platinum Weekly options. This latest enhancement to our existing options suite provides market participants with expanded flexibility to manage short-term price risks in the PGM markets.

In today's market, characterized by increased volatility, short-dated options can be a valuable addition to your portfolio. Our suite of Metals Weekly options for gold, silver and copper allows traders to gain exposure and manage price risk more precisely every day of the trading week.

In Q1 2025, Gold Weekly options averaged over 23K contracts per day, marking a 33% year-over-year increase from Q1 2024. Silver Weekly options averaged nearly 3,471 contracts daily, up 32% from the same period last year. Copper Weekly options have also seen increased demand, rising 38% to now trade at 1,032 contracts per day.

The rise in volume aligns with macroeconomic events, driving a heightened need for hedging against price volatility. These volume increases benefit both new and existing market participants by enhancing market liquidity and reducing bid-ask spreads, making Metals Weekly options more accessible and effective.

Gold, silver and copper all exhibit the potential for upward movement, making non-linear exposure a logical consideration for market participants. The long-term skew trends suggest that investors continue to assign value to upside optionality, reflecting an underlying expectation of potential price appreciation.

Additionally, the historical pricing of call skew across these metals indicates that the options market remains well-supplied and liquid, allowing for efficient price discovery. Current call skews also appear reasonable within a historical context, suggesting that options pricing has remained balanced relative to broader market conditions.