The triple (or quad)-witching during this novel crisis...

Discussion in 'Trading' started by Overnight, Mar 19, 2020.

  1. Overnight

    Overnight

    So this will be the first uber-witchy bitch while in a global market crisis since 2008/9.

    All those quarterlies that were established during peaks are going to have to be settled at the near bottom of this vicious downturn tomorrow.

    Anyone have any ideas on the chaos that shall ensue, and where we may wind up in the aftermath next week?
     
    zghorner likes this.
  2. southall

    southall

    Black Monday October 1987 was the Monday after option ex.
     
    KCalhoun likes this.
  3. Overnight

    Overnight

    What does that have to do with triple-witching?
     
  4. ET180

    ET180

    Well, it's a known event that everyone sees coming. Not too worried about it. I'm more concerned about the likely huge increase in known cases impact on Monday's open. Although, I think that's probably priced in by now.
     
    KCalhoun likes this.
  5. zghorner

    zghorner

    half of my positions expire tomorrow so im hoping for an absolute bloodbath.

    Doing some research on triple/quad witching effects on S&P after black Monday and not really able to see anything. Black Monday or BM as i like to call it because im sure it really stunk for you old cats...happened 10/19/87. the next quad witching day wasnt until 12/18/87 which is just after the beginning of a bull market. I was curious to see what happened after a melt down and during bear trend but no such luck.

    Would like to here some opinions from you more experienced members.
     
  6. SanMiguel

    SanMiguel

    I imagine the put call ratio is high right now so I would expect institutions to try and move the market up to reduce the premium of the puts
     
  7. ET180

    ET180

    But those institutions have also likely been selling calls as price came down.
     
  8. SanMiguel

    SanMiguel

    They sell whatever people are buying, which is more puts than calls right now
     
    zghorner likes this.
  9. Overnight

    Overnight

    Indeed, that was the reason for my query. We haven't been in this particular situation in over a decade.

    Fun times, or should we run?

     
  10. zghorner

    zghorner

    the market had just started to turn downwards Feb 21 (last months exp date) and its been a shit show ever since...I but you are right in that the number of puts sold far far exceeds calls. Hopefully the MM keep it red in the morning so I can get out before they start to pump bears in the ass.
     
    #10     Mar 19, 2020