As options and futures contracts expire, traders must close or roll out their existing positions to a future expiration date. Triple Witching occurs because the expiration dates for stock options, stock index futures, and stock index options all fall on the same day. Stock options give the holder the right to buy or sell a stock at a specific price on or before the expiration date. Stock index futures allow traders to bet on the future direction of a stock index. Stock index options give the holder the right to buy or sell a stock index at a specific price on or before the expiration date. During Triple Witching, traders and investors often try to close out their positions or roll them over into the next expiry month. This can create a significant amount of trading activity which affects volumes and creates extra volatility in the markets. In summing up, triple witching stands as a noteworthy event in the financial landscape, shaping unique opportunities and hurdles for market enthusiasts. But this compensation does not influence the information we publish, or the reviews that you see on this site. We do not include the universe of companies or financial offers that […]