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With the recent market gains, now may be the time for investors to consider buying call options as a substitute for stocks, according to Goldman Sachs. After turning positive for the year last month on the heels of the U.S. and China agreeing to temporarily cut tariffs for 90 days, the S & P 500 is now within striking distance of scoring a new high. As of Thursday’s close, the broad market index was 1.7% away from its February record. Prior to Israel’s strike on Iran, the index was on pace for its third positive week in a row, and looked poised to notch a new record shortly. As of Thursday, the S & P 500 had advanced almost 3% over the past month and more than 9% over the past three months. Its year-to-date climb stood at about 2.8%. “For investors holding stocks that have outperformed, we view this backdrop as particularly attractive for replacing stock with long calls,” wrote John Marshall, head of derivatives research at Goldman, in a Wednesday note. Marshall highlighted several buy-rated “stock replacement” names, including Meta Platforms and CrowdStrike , that have outperformed both the S & P 500 and their respective sector indexes by more than 10%. “If the stocks continue to trade higher, investors maintain upside exposure, but in the event the rally stalls, investors lose only their premium paid,” he also wrote. Meta Platforms has had a solid year so far, having risen more than 18% in 2025 and more than 17% over the past three months. Goldman noted that the “Magnificent Seven” name has outperformed the S & P 500 by 17% and the information technology and communication services sectors by 12%. This comes as Meta is increasing its artificial intelligence bets. On Tuesday, people familiar with the matter told CNBC that Meta is currently finalizing a deal to invest $14 billion into Scale AI, tapping its co-founder Alexandr Wang to join the company to help reach its AI goals. META YTD mountain META, year-to-date Dollar Tree was another name highlighted by Marshall, with the discount retailer outperforming the S & P 500 by 22% and the consumer staples and discretionary sectors by 20%. The stock has surged more than 45% over the past three months and more than 37% over the past six. DLTR YTD mountain Dollar Tree stock year to date However, shares came under pressure last week after the company said adjusted earnings per share in the current quarter could see a year-over-year fall of as much as 50%, citing President Donald Trump’s tariffs as a headwind. Uber Technologies , which has been a big winner this quarter with a rise of more than 17% during the period, also made the list. Shares of the ride-hailing company have also outperformed the S & P 500 by 41% and the industrials sector by 33%.
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