Short term
Trade view / 09 June 2016 at 11:00 GMT

#SaxoStrats: Opt for gold in those Brexit hills

Head of Commodity Strategy / Saxo Bank

t Background

The UK's vote on whether to remain in the European Union or leave set for June 23 should in general have a limited impact on commodities with the main impact coming from potential currency movements, especially in the aftermath of a leave vote.

However heightened event risk and the uncertainty related to the market impact of a leave vote could provide precious metals with additional support and we particularly favour gold as part of a safe-haven asset flight.

While we overall maintain a positive outlook for gold as it pushes beyond $1,250/oz, we prefer to express the event risk related to the vote through options. 

For more details on this trade, view the related video here.

Management and risk description

We cover this through options to mitigate risk. See video release here for more.

XAU $1,275/oz Call @  $12.50/oz (ref. $1,243.50/oz)
XAU $1,300/oz Call @ $7.50/oz    (ref. $1,243.50/oz)

The risk is confined to the premium paid.

Time horizon: June 24.

Gold consolidating above $1,250/oz ahead of the UK's EU referendum vote


Source: SaxoTraderGO

Gold five-year chart


Source: SaxoTraderGO

Trading the Brexit vote?
Find more analysis, insight and essential resources on our dedicated Brexit page.

— Edited by Martin O'Rourke

Non-independent investment research disclaimer applies. Read more


The Saxo Bank Group entities each provide execution-only service and access to permitting a person to view and/or use content available on or via the website is not intended to and does not change or expand on this. Such access and use are at all times subject to (i) The Terms of Use; (ii) Full Disclaimer; (iii) The Risk Warning; (iv) the Rules of Engagement and (v) Notices applying to and/or its content in addition (where relevant) to the terms governing the use of hyperlinks on the website of a member of the Saxo Bank Group by which access to is gained. Such content is therefore provided as no more than information. In particular no advice is intended to be provided or to be relied on as provided nor endorsed by any Saxo Bank Group entity; nor is it to be construed as solicitation or an incentive provided to subscribe for or sell or purchase any financial instrument. All trading or investments you make must be pursuant to your own unprompted and informed self-directed decision. As such no Saxo Bank Group entity will have or be liable for any losses that you may sustain as a result of any investment decision made in reliance on information which is available on or as a result of the use of the Orders given and trades effected are deemed intended to be given or effected for the account of the customer with the Saxo Bank Group entity operating in the jurisdiction in which the customer resides and/or with whom the customer opened and maintains his/her trading account. When trading through your contracting Saxo Bank Group entity will be the counterparty to any trading entered into by you. does not contain (and should not be construed as containing) financial, investment, tax or trading advice or advice of any sort offered, recommended or endorsed by Saxo Bank Group and should not be construed as a record of ourtrading prices, or as an offer, incentive or solicitation for the subscription, sale or purchase in any financial instrument. To the extent that any content is construed as investment research, you must note and accept that the content was not intended to and has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such, would be considered as a marketing communication under relevant laws. Please read our disclaimers:
- Notification on Non-Independent Invetment Research
- Full disclaimer

Check your inbox for a mail from us to fully activate your profile. No mail? Have us re-send your verification mail