by Shawn Langlois
Look out, above!
S&P 500 index monthly options expire this Friday, and Erik Lytikainen, longtime trader and founder of Viking Analytics, says that, just like this time last year, investors could be in store for some real fireworks.
Just not necessarily the bearish kind we saw in 2018.
“Last December, in and around the final option expiration of the year, the S&P 500 fell by nearly 300 points,” he wrote Wednesday in a post on RealInvestmentAdvice.com. “This dramatic decline coincided with a spike in market gamma. It is my view that this decline was furthered by forced selling by the put sellers who needed to sell the S&P 500 index to cut their losses.”