Expiration manipulation

Discussion in 'Options' started by damon_achey, Mar 18, 2006.

  1. So several equities I've been trading options on had interesting pin situations happen yesterday and I was wondering how this works and was curious if there is possible room for manipulation?

    First, I closed out all my open contracts for .05-.10 before close so I have nothing riding on this, I was just curious.

    1) If it was bouncing around right at the strike how hard is it to push it over or under on the very last tick?

    2) Would someone even want to do this? What would they gain?

    I'm guessing the first would be easy, and the second might be no real benefit to just closing the contracts or buying buying/selling the shares in the after hours. But any insight that you could share would be great.

  2. bgp


    did you read [todays] saturdays wall street journal ? page 5 will tell the story.

  3. i dont have the journal, can anyone offer the gist
  4. The WSJ article I saw on page A1 and A5 was about how it looks like some companies are backdating options granted to a company's executives so that they occur just before a big rally. I didn't see anything about stock price behavior on monthly option expiration days.
  5. SHLD and SNDK were held around 1 strike for the rest of the day on Friday.