Shares of the SPDR Gold Shares (GLD) have screamed higher mid-day on the back of a (somewhat) surprising release from the Federal Reserve. The ETF is higher by 1.49%, trading at $170.43.
With the Fed agreeing to launch a third round of quantitative easing, buying mortgage backed securities at a pace of $40 billion per month, growth and inflationary trades seem to be back on the table.
A large, notable trade hit the tape in GLD roughly 20 minutes before the Fed release (curious, isn?t it?), where the December $160 put was sold 25,000 times, on the bid, for $3.15. Volume far exceeded open interest here, which indicates fresh positioning.
With the puts now bid $2.41, at $2.49, the trader is in the green to the tune of $1.65 million. Not bad for a half hour?s work.
Note: while a 700k block of stock was sold for $168.07 a minute later, the trades do not appear to be linked in any way.
Front month Gold futures are trading at $1,764.20, up 1.78% on the session.
The SPDR Gold Shares seeks to replicate the performance net of expenses of the price of gold bullion. The trust holds gold and is expected to issue baskets in exchange for deposits of gold and to distribute gold in connection with redemption of baskets.