Metals weekly options for gold, silver, and copper have seen remarkable growth in trading activity so far in 2024. The surge in volume aligns with macroeconomic events global interest rate adjustments, driving heightened demand for hedging against price volatility.

Gold weekly options have average over 22K contracts per day, reflecting a 66% year-over-year increase. Silver weekly options average nearly 4K contracts daily, up 98%, and copper weekly options have seen an exceptional growth, increasing 123% over the last year, now trading 800 contracts per day. 

The volume increases can benefit new and existing market participants by enhancing market liquidity and reducing bid-ask spreads, making metals weekly options more accessible. 

The growth in these products make metals weekly options a compelling choice for traders looking to diversify portfolios or gain exposure to metals markets with manageable risk.

What is the likelihood that the Fed will change the Federal target rate at upcoming FOMC meetings? How can the interest rate affect metals prices? Can I use short term options to help manage the risk? Why keep asking questions? 

Use CME FedWatch to track the probabilities of changes to the Fed rate, as implied by 30-Day Fed Funds futures prices for the December 17 & 18 meeting. 

Below are the closest contract expiries for Gold, Silver and Copper to help you manage risk around the Fed meeting in the most precise way.

Expiries of Metals Weekly options every day of the trading week - Monday through to Friday to the nearest 30 days in addition to the standard monthly expirations - provide market participants with granular control over hedging strategies, particularly around unpredictable market events. 

Macro events can happen at any time, and market participants looking for opportunities or to manage market risk can access Gold, Silver and Copper Weekly options on every day of the week.

The strong liquidity and flexibility of Gold, Silver and Copper Weekly options strong liquidity and flexibility make these products a compelling choice for traders

CME offers rich implied volatility data through QuikStrike. As gold rallied to all-time highs in 2024, the ratio of puts to calls has leaned consistently toward calls being more in demand than puts. There was a very interesting, but short lived reversal of this trend immediately following the presidential election.

The chart below shows that the 25 delta skew has consistently favored calls about 1.5 to 2.0 implied volatility points above puts in 2024. As gold sold off immediately following the election results, puts and calls traded near parity with each other for the first time in years. However, this was very short lived as demand returned once again to calls over puts within a few trading days.

A closer look at calls and puts separately reveal that calls became cheaper and puts became more expensive. During the time that calls and puts were near parity, you can see that both were trading at levels close to the at-the-money vol. Examining puts and calls separately reveals that this resulted in a brief flat vol smile.

Paying close attention to shifts in skew during major events can reveal sentiment. In this case, a quick shift to buying puts with a return to favoring calls once again. Given the speed of the move, one could conclude that position taking around the election temporarily changed the shape of skew. Indicators such as these that are offered in QuikStrike can be a valuable information point in making trading decisions.