Veteran Options Trader James Cordier Pivots to Structured Spreads Amid Commodity Boom

James Cordier, a longtime figure in commodity options, is promoting a shift from “pure premium” selling toward structured option spreads as volatility surges across raw materials from gold to coffee. In a recent interview with AInvest, Cordier said his team has “a much safer structure now that we manage portfolios with,” adding that while options always carry risk, “utilizing a structure slows down the market dramatically and very much vastly reduces your downside.”

He framed the approach as a response to 2025’s sharp moves in headline commodities. “Primarily, what we’ve learned in 2025 is that you don’t need to take the most aggressive approach,” Cordier said, noting that markets such as coffee, copper, and cocoa “doubled in price” this year. He argued that option spreads—rather than naked premium selling—let investors participate with “limited downside risk.”

Cordier suffered a setback in 2018 when his firm made the wrong call and lost over $100 million. His latest business, OptionSpreaders.com, focuses on spreading strategies, option combinations designed to cap losses while sacrificing part of potential gains. “The market can move way against you in many cases, and the structure is keeping you in place for your longer-term fundamental view,” he said.

He pointed to precious metals as particularly conducive to his strategy. “What’s going on in the precious metals right now is practically ideal for the type of option trading that we do,” Cordier said, citing persistent buying by central banks and growing investor interest. In the interview, he described gold prices as having recently advanced to levels “around $4,300 or $4,400,” and said talk of “$5,000 gold and beyond” had become “quite realistic,” while cautioning that enthusiasm can foster bubbles.

Coffee has also turned into a high-profile case study, according to Cordier. He referenced a “50% tariff” on Brazilian goods and weather disruptions, “what they’re calling a hundred-year drought,” as factors that have tightened supply and pushed prices “from $2 a pound” to “$4 a pound.” In such conditions, he said, out-of-the-money call options can become “overpriced,” creating opportunities to sell calls “with a structure” rather than taking on unlimited risk.

Not all commodities are in play, he added. Corn and soybeans are “extremely stable,” with “premiums” dwindling, making them less attractive for options trading at present. By contrast, he expects the year’s moves to broaden institutional and high-net-worth adoption of diversified commodity strategies. He argues that the traditional 60/40 portfolio could evolve to “60-30-10,” with the 10% allocated to alternatives such as commodities.

Cordier is also returning to publishing. A brief description of his new book, Reflections of an Option Seller, says it “illuminates the complexities of commodity futures and options markets” and emphasizes “adaptability and perseverance” learned from experience navigating today’s markets.