Is Option Trading Volume in 2023 at an All Time High?

Tom Gentile

Posted in
Options Trading

By: Tom Gentile
February 10th, 2023

2 mins read

A heads-up email via email hit my inbox today.  It was from one of my programmers, the chief architect of the software

He sent an image and info from CBOE Global Markets, and it showed that options trading volume looks to be at all-time highs, and they reached that here in February

Here are a couple of bullets of the data shown.

  • In a single ay in early February 40+ million options contracts traded / changed hands
    • That was the highest level on record, which almost bested 2022’s daily average volume for combined puts and calls
  • That propelled the overall activity above 68 Million contracts, which is also a record.

Look at the image that accompanied the data for Daily Call Options Volume (Figure 1).

Figure 1 Daily Call Options Volume
Figure 1 Daily Call Options Volume

Reasons for Extreme Options Trading?

There is likely a bunh of reasons for sugh high otpions trading activity thus far in 2023, but here isour take on a possible few.

The markets may be anticipating the Fed executing a soft landing when it comes to a recession as they fight to battle excessively high inflationi.

Along with that comes the markets possibly having already priced in those concerns and the Fed’s anticipated next one or two rate hikes and bulls feel the worst is behind us.

Earnings:  The earnings for companies being reported now – already half-way through the companies in the S&P 500 – haven’t been lightin the world on fire.  The numbers of earnings and revenues are coming in pretty flat.

There might be some that still feel confident loading up on options trades since flat is better than down/poor and to see things holding up at least flat a year after the markets were the most bearish its been in 5-10 years adds to their optimism.

To Wrap

Whether you see things in these lights or not, one can see and or research more data to help you gain conviction for trading options, trading options even more than you already are or maybe you decide to stand down.

You know how you feel about the markets and this insight now give you a view on how others / option traders feel so far this year.

App: Toms Option Tools

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