Let me start by saying this is probably the most boring memo I will ever write. That said, I think it’s worth understanding what is driving some of the recent market volatility.
Got any ideas?
Here’s a few hints: 1. It’s not just the threat of a government shutdown or unpredictable trade policies. 2. It’s even predictable.
Ready for the answer?
It’s time for Triple Witching Day!
What is that?
The third Friday of each quarter is called the “Quarterly Options Expiration Day;” also known by as Triple Witching Day. The last hour of the day is the “witching hour.”
People who buy options have the right to buy or sell stocks at a set price. These options expire every three months, on a specific day. The next one is March 21st, 2025. On that day, if the person holding the option doesn’t use it, the stock option becomes worthless.
This extra buying and selling are often accompanied by increased volatility and trading and can make the market more unpredictable.
What comes after the witching hour?
Typically, there is a bit of a settling down period and the markets no longer feel rushed or volatile. …. or at least until the next news cycle hits.
Stay the course,
Barbara
March 16,2025
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