After Trump suspended tariffs, the price of call options surged ninefold
ChainCatcher news, Trump announced on social media at 1:18 PM Eastern Time on Wednesday that he would suspend tariffs on certain countries, causing the S&P 500 index to surge by 9.5%.Market data shows that prior to this, trading activity in certain options contracts had skyrocketed. For example, according to Trade Alert data, when the price of the S&P 500 ETF (SPY) was around $501.50, approximately 5,105 SPY call options (bets that the stock price would rise above $502) were traded around 1:00 PM Eastern Time at an average price of $4.20. In the afternoon, as the stock market surged, the price of these call options peaked at around $42. On paper, if all 5,105 call options were held, their value would increase from approximately $2.14 million to about $21.44 million.