Tom’s Weekly Newsletter September 15, 2021

Tom Gentile

Posted in Newsletter

By: Tom Gentile on September 15th, 2021 • 1 min read

This Friday is quadruple witching. What is that exactly? It is where we see the expiration of individual stock options, stock-index options, stock-index futures, and single-stock futures all on the same day (this Friday).

In an article found on marketwatch.com head of research at Pepperstone says the S&P500 has fallen in the week leading into options expiration the past 6 months of the year.

Quadruple tends to bring with it the potential for increased volatility into the markets along with higher trading volume.

Without getting in to the nitty gritty of how market makers work, basically those who have sold options are taking positions in the underlying stocks or other instruments to hedge their market exposure.

This leads to a potentially choppy market and a market with a risk to trade lower going into expiration.