$2.7 Trillion Wall of Expiring Options a Worry for Traders Reeling From Bank Crisis;

Discussion in 'Wall St. News' started by ETJ, Mar 17, 2023.

  1. ETJ

    ETJ

    $2.7 Trillion Wall of Expiring Options a Worry for Traders Reeling From Bank Crisis; Triple witching, index rebalance set to spur trading volume; Event may help 'unpin' S&P 500 from the 4,000 level: BI
    Lu Wang - Bloomberg
    Just as a week of global bank drama winds down, Friday's options expiration risks creating fresh turmoil for traders. An estimated $2.7 trillion of derivatives contracts tied to stocks and indexes are scheduled to mature, obliging Wall Street managers to either roll over existing positions or start new ones. The process usually involves portfolio adjustments that lead to a spike in trading volume and sudden price swings. While the event has its benefits, such as amping up liquidity, that may not be enough to appease investors reeling from shocks ranging from the collapse of three US banks to hawkish comments from Federal Reserve Chair Jerome Powell.
    /jlne.ws/42iPwAc