Tomorrow, March 21, 2025, is a major stock market event called “triple witching,” which happens every three months. On this day, three types of financial contracts—stock options, stock index options, and stock index futures—expire at the same time. This often leads to increased market volatility and trading activity, especially in the last hour of trading.
This time, a massive $4.5 trillion worth of options are expiring, with a majority being put options—bets that stocks will go down. This could indicate bearish sentiment, but the actual market impact will depend on how traders adjust their positions during this volatile period. If many of these puts expire without being exercised, dealers may have to buy stocks to balance their positions, potentially pushing prices up. However, the final outcome will depend on trader behavior, market sentiment, and external factors like the upcoming inflation report. Expect a busy trading day with possible big price swings, especially in stocks with high derivatives activity. Stay alert!
Be First to Comment