Friday, September 21, 2007

Warning: Triple Witching Hour

The market is expected to undergo volatile trading this morning with triple witching taking place between 10.10 am and 10.30 am (London time). Triple witching refers to the expiry of the contracts for stock index futures, index options and equity options all on the same day.

The final hour of the stock market trading session on the third Friday of March, June, September, and December, when option contracts and futures contracts expire on market indexes used by program traders. The simultaneous expirations often set off heavy trading of options, futures and the underlying stocks, which can cause large fluctuations in the value of their underlying stocks.

No comments: