FRANKFURT (dpa-AFX) – This Friday is another big expiration day: On this day, futures contracts on stocks and indices expire on the futures exchanges. Stock market experts speak of the “great expiration” or “quadruple expiration” when options and futures on indices and individual stocks expire on the same day.
There are a total of four major outage dates each year, on the third Friday of March, June, September and December. On these dates, share prices and indices can fluctuate noticeably without any significant news. There are stronger price fluctuations on days, especially for heavyweight stocks in the corresponding indices.
Behind these fluctuations are market participants whose deadline for carrying out their derivative transactions is expiring. All larger fund or asset managers try to drive prices up to the prices at which they are active on the futures exchange. Accordingly, high trading volumes and significant price fluctuations can occur within minutes. Individual small investors can hardly intervene to move prices.
At midday at 12:00 p.m., during the so-called fixing, the index options and futures of EuroStoxx 50 and Stoxx 50 on Eurex expire. At 1 p.m. the futures and options on the Dax and the TecDax fell in the midday auction and five minutes later those on the MDax.
The options and futures on the individual stocks then expire towards the close of trading. This applies not only to the German derivatives exchange Eurex, but to most major stock exchanges worldwide. While the derivatives on German and French stocks on Eurex expire at 5:30 p.m., this is already the case in Switzerland at 5:20 p.m./ck/ajx/jha/
