To The Moon

On March 10th, the international gold price rebounded after falling back the previous day. The core change in market sentiment is that as US President Trump released the signal that the situation in the Middle East may ease, oil prices have dropped significantly from their highs, and inflation concerns have eased; At the same time, the weakening of the US dollar has also boosted the attractiveness of gold to overseas buyers. Reuters reported that spot gold rose by about 0.7% on the same day, and U.S. gold futures rose by about 1.6%, indicating that safe-haven demand and interest rate expectation trading are still supporting gold prices together.

Corresponding to$Gold ETF-SPDR (GLD) $The above macro background means that although gold fluctuates in the short term, the overall support logic has not been destroyed. On the one hand, the situation in the Middle East has not really been eliminated, and the market remains vigilant against geopolitical risks; On the other hand, the drop in oil prices and the weakening of the US dollar have improved the marginal pricing environment of gold. In other words, the current position of GLD is more like a "strong repair in high oscillations" than a trending weakening.

In this context, if it is judged that GLD has a high probability of holding the support around $460 before its expiration, it can be considered to build460/455 Bull Bearish Spread Strategy: Strive for profits by collecting premium while controlling downside risks. This type of structure is suitable for the judgment that the target is "more but not radical", and it is also more in line with the current state of gold that "the hedging logic is still there, but the short-term fluctuation is large".

GLD Bull Put Spread Strategy

Strategic Structure

Investors in$Gold ETF-SPDR (GLD) $Options build aBull Bearish Spread (Bull Put Spread)Strategy.

This policy belongs toBullish/volatile strategy of charging premium, limited income and limited riskIt is suitable to judge that GLD can hold the lower support area, maintain shock or moderate rise before expiration.

1 ️ ⃣Sell Higher Strike Price Put (Main Source of Revenue)

• Sell 1 strike priceK₂ = $460Put of

• premium charged =$2.53/Share(at the middle price)

The Put is closer to the current price and is a major source of revenue for Strategy premium.

As long as the expiry price≥ $460, the option lapses and the investor retains all premium rights.

2 ️ ⃣Buy lower strike price Put (control downside risk)

• Buy 1 strike priceK₁ = $455Put of

• Paid premium =$1.66/Share(at the middle price)

Maximum Profit

When GLD Expires Price≥ $460When:

• Both puts are out of the money

• All options lapse

Investors retain all net premium:

• Maximum Profit (Per Share) = $0.87

• Per contract (100 shares) = $87

Occurrence conditions:

Maturity price ≥ $460

Maximum loss

When GLD Expires Price≤ $455When:

• Both puts are in-price

• The strike spread is fully locked in

Strike spread:

460 − 455= $5

Maximum loss (per share):

Strike Spread − Net premium

=5 − 0.87= $4.13/share

• Maximum loss per contract = $413

Occurrence conditions:

Maturity Price ≤ $455

BREAK-EVEN POINT

Sell Put Strike Price − Net premium

=460 − 0.87= $459.13

Maturity judgment:

• Price ≥459.13 → Earnings

• Price =459.13 → No Profit or Loss

• Price ≤459.13 → Loss

V. Strategy characteristics and applicable scenarios

Strategic characteristics

• ExplicitBiased/Looking at the Strategy of Volatility and Strongness

• Collect premium Structure, Time Value Is Good For Investors

• The maximum gain and maximum loss are determined when the position is opened

• Compared to naked selling Put, downside risk is capped

• Risk-to-return ratio of approximately1: 0.21(Risk 4.13, Return 0.87)

Applicable Scenario

When investors judge:

• GLD inStrong support around $460

• In the short termLower probability of an effective break below $455

• Gold remains overall between geopolitical risks, a weaker US dollar and easing inflation expectationsStrong oscillation

• OrImplied volatility is in a high positionWhich is suitable for constructing a premium collection structure

Reuters reported that the current rebound of gold is mainly supported by the fall of the US dollar, the easing of inflation worries after the fall of oil prices, and the fact that the risks in the Middle East have not completely dissipated; This means that although gold may not immediately rush up unilaterally in the short term, there is still a strong fundamental support below.

The structure is essentially:

"Use the risk of $4.13 to gain the income of $0.87."

The winning rate of the strategy depends on"GLD holds support near below 460, at least not effectively falling below 459.13"Judgment of; If the subsequent US dollar strengthens rapidly, real interest rates rise, or geopolitical safe-haven trading cools down significantly, and GLD falls below support, the portfolio loss will expand, butThe largest loss has been capped at the time of opening the position。