COMEX Gold Options Speculation

There is an increasing amount of chatter regarding a surge in open interest for deeply out-of-the-money options on COMEX gold. Whether or not there's anything substantial behind these speculative trades remains to be seen.

COMEX Gold Options Open Interest And Market Speculation

Let's start with what we know. Below is a screenshot from the CME website that shows total open interest in call options on Dec26 COMEX gold. As I type, that contract is trading at about $4100, but as you can see, there are a substantial number of open call options from $10,000 to $20,000. For these to be "in the money" by the time they expire on November 26, price is going to have to surge by nearly 5X.

Dec26 COMEX Gold Call Options Open Interest Screenshot

And this is not an anomaly or data malfunction. These options are real and actually trading. Below is a screenshot from my futures and options account at Schwab. As of Monday, June 29, the $20,000 strike price call was trading with a bid of 0.90 and an offer of 1.00. This means that you could buy some for $100 each.

$20,000 Strike Price COMEX Gold Call Option Screenshot

Gold Revaluation Theory And Insider Trading Concerns

OK, so what's going on here? Maybe nothing. Perhaps this is just a hype-driven scam intended to fleece precious metal speculators. Perhaps. But here's the thing. There have already been cases alleging insider trading and profiteering from Iran War headlines. A reminder:

• Online prediction market traders make millions betting on U.S. military operations

And the New York Times was out this weekend with a lengthy expose that details possible corruption in grants and investments regarding critical minerals.

• Trump Cut a Billion-Dollar Mining Deal. His Sons Stand to Profit.

From that article, this summary:

Critical Minerals Article Summary Image

As such, the notion that "insiders" are stealthily positioning themselves to profit from some future event like an official gold revaluation is not implausible. But is it likely? You'd think that the CFTC or SEC would be aware of this, too, should those call options end up deeply in the money. Could the corruption and profiteering be so rife and bald-faced that no one would be called to account if these bets become wildly profitable? Maybe. Think about all of the obvious insider trading that's done by U.S. congressmen and senators. None of that ever gets punished, so why would the supposed "regulators" take action in this case?

Physical Gold Investing Versus Speculative Gold Options

For me, however, I'm just going to sit back and watch even though my 2026 forecast detailed why I thought that some form of official gold revaluation was possible, or even likely, this year. You see, if that revaluation theory becomes reality, I'm going to realize tremendous gains from my physical metal and mining company positions. I don't need to horse around with deeply out-of-the-money call options in order to generate profits. I found this graphic in Eric Yeung's X feed. For me, it provides a pretty good summary.