Triple witching day
Triple witching is the expiration on the same day of three different types of derivative contracts: stock options, stock index futures, and stock index options. It occurs quarterly, on the third Friday of March, June, September, and December. There is often increased trading activity on triple witching days as traders close, roll out, or offset their expiring positions, especially in the final hour of trading. This can also create wild swings in volatility, which some view as a profit-making opportunity.
Single stock futures, which last traded in the U.S. in 2020, were for a time grouped with stock options, index options, and index futures, leading to the term "quadruple witching." But since single stock futures failed to gain ground as a product, the term has reverted to "triple witching."
- ↑ Triple Witching: Definition and Impact on Trading in Final Hour. Investopedia.
- ↑ What is Triple Witching? Explanation, Dates, Examples & Trends. The Street.
- ↑ Morris, Virginia B./OIC (2005) An Investor's Guide to Trading Options, Lightbulb press/Options Industry Council. ISBN 0-9764749-9-9