Goldman Sachs (GS) acquiring $50 billion in bank assets, shares rise

Goldman Sachs (NYSE: GS - option chain) shares are rising today as the markets bounce back from yesterday's bloodbath and the company announces that is is looking to buy up to $50 billion in assets as a way to become a major player in the banking industry now that it is a bank holding company. If you think that the stock won't fall by too much in the coming months, then now could be a good time to look at a bullish hedged trade on GS.

GS opened this morning at $126.89. So far today the stock has hit a low of $124.50 and a high of $129.00. As of 12:45, GS is trading at $127.38, up $6.68 (5.5%). The chart for GS looks bearish and S&P gives GS a 3 STARS (out of 5) hold ranking.

For a bullish hedged play on this stock, I would consider a November bull-put credit spread below the $50 range. A bull-put credit spread is an options position that combines the purchase and sale of put options to hedge risk in case the stock doesn't do what you think but still leverage nice returns. For this particular trade, we will make a 6.4% return in just eight weeks as long as GS is above $50 at November expiration. Goldman would have to fall by more than 60% before we would start to lose money. Learn more about this type of trade here.