Goldman Sachs(GS) Call Options Active on Q42011 Earnings Beat!! By: Tim Bolger

Goldman Sachs(GS) is arguably the most powerful and innovative investment firm on planet Earth and runs Wall St. in my opinion.  Run by Wall St. legend Lloyd Blankfein (CEO of GS), they are at the forefront of several capital markets deals, stellar traders, have an amazing advisory services business, investment management, investment banking, etc.  Many of the smartest financial professionals in the world flock to Goldman for an opportunity to make millions of dollars.  If you work at Goldman, in my opinion you are the creme de la creme of financial services pros…When Goldman talks, investors listen…whether they like the news they are hearing or not. GS can move markets with their fundamental research and analysis of the markets.  GS is also brilliant on the technical side of trades as well and I think they are among the best trading firms in the world…they definitely have a spectacular track record in that department…

Despite their brilliant fleet of financial wizards, GS stock had a terrible year in 2011 alongside a majority of financial stocks and declined over 45%. Today, they beat Wall St. earnings estimates and the stock is up over 5% on big volume. GS earned $1.01 Billion in Q4 2011 and had Earnings Per Share(EPS) of $1.84 for the quarter. Fourth quarter EPS beat the street by a whopping 60 cents a share and investors are reacting very positively to this quarterly news report and piling into both the shares of stock and options contracts. Is the slide in GS shares over?? Is it time to get in the shares for the long term??  I would argue that owning the shares anywhere around a $100 is a great buying opportunity for longer term investors who believe in both the survival of Wall Street and the global capital markets…I certainly do and GS will be one of the biggest and most powerful whales in the sea. Businesses need capital for growth/survival in difficult economic cycles and to compete in this ever fast changing world…

GS Call Options are very active today and might be time to load up…Check out the front month GS 105 strike Jan 20,2012 Call Options being bought like hot cakes today as investors pile in to position for a bigger move up in the shares over the next few days.  Here is the options chain for Jan 20, 2012:  http://finance.yahoo.com/q/op?s=GS+Options. This is a very risky but potentially lucrative trade for those traders with a hunger for risk and is a trade being executed by many professional options traders and savvy investors today.  A more conservative play would be to think about buying the April 20, 2012 110 or 115 strike Call Options on GS to position yourself for a continued rise in the shares. Here is the GS April 20, 2012 Options chains:  http://finance.yahoo.com/q/op?s=GS&m=2012-04. GS traded close to 175 last year and definitely has alot of room to run if the stock continues to gain momentum and more positive investor sentiment. If a few analysts upgrade the stock as well, that would be very favorable for GS shares and could easily send the shares higher to 125+ in the next couple of months…We shall see and only time will tell the story… On a bearish note, the markets may be nearing a short term top and if the market falls, GS may decline with the rest of the equity markets…We might want to wait on the side line for a pullback in the shares and the overall markets before jumping into this trade on GS. Remember patience and timing is key to making successful Options trades…And yes alot of luck is involved in making money with Options as well…No investor or trader has a magic crystal ball that will tell for certain what actually will happen on Wall Street or to any individual stocks for that matter. Check out the 5 day chart on GS courtesy of YahooFinance below. Big volume today and the shares are spiking to the upside!! Optionshoney.com disclaimer.  Until next time folks. Stay tuned for more…

—Tim Bolger

http://finance.yahoo.com/q/ta?s=GS&t=5d&l=on&z=l&q=l&p=&a=&c=