Understanding Quadruple Witching: What Every Trader Should Know

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11 Jun, 2025

Understanding Quadruple Witching: What Every Trader Should Know

In the world of financial markets, there are certain days that stand out due to the unusual volatility and sharp movements witnessed during trading hours. One such event is known as Quadruple Witching. While it sounds like something out of a fantasy novel, it’s a real and impactful occurrence in the global markets, particularly in the United States — and it indirectly influences markets like India as well.

Let’s explore what it means, when it happens, and why traders and investors pay close attention to it.

What is Quadruple Witching?

Quadruple Witching refers to a day when four types of derivative contracts expire simultaneously:

Stock Options
Stock Index Options
Stock Index Futures
Single-Stock Futures

This simultaneous expiry creates a surge in trading activity and volatility, especially in the last hour of trading on that day, which is often called the ‘witching hour’.

However, since Single-Stock Futures have not been traded in the US markets since 2020, the event is now technically known as Triple Witching. Yet, many market participants continue to use the term Quadruple Witching out of habit.

When Does It Happen?

Quadruple (or Triple) Witching happens four times a year, specifically on the:

Third Friday of March
Third Friday of June
Third Friday of September
Third Friday of December

On these days, traders and fund managers adjust, roll over, or square off their positions to avoid unwanted exposure, leading to heightened volatility and trading volume.

How Does It Impact Markets?

The biggest impact is typically seen in:

Increased trading volumes — as positions are adjusted, rolled over, or squared off.
High volatility — particularly in the last hour of US market trading (commonly known as the witching hour).

Since the US market is one of the largest globally, this volatility often spills over to other markets, including Indian markets. The ripple effect can be felt:

One day before the actual witching day
One day after the event

This can create sharp moves in indices like NIFTY and SENSEX, as global funds adjust their portfolios across regions.

Why Should You Care?

For traders, especially those dealing in derivatives, knowing about Quadruple Witching is crucial because:

It can lead to unexpected price swings.
Derivatives markets may witness sudden volume spikes.
Stop-losses and margins can be triggered due to sharp volatility.

Even for long-term investors, awareness helps to avoid getting unnerved by sudden market movements driven by expiry-related adjustments.

Disclaimer

This article is purely for educational and informational purposes. It does not constitute financial advice or a recommendation to trade in any particular asset or market. Always conduct your own research and consult with a financial advisor before making investment decisions.

Final Thought

Whether you’re a short-term trader or a long-term investor, being aware of market events like Quadruple Witching helps in better risk management and avoiding surprises in your portfolio. While you don’t necessarily need to act on it, understanding its influence on market behavior can improve your overall market awareness.

Our Recent FAQS

Frequently Asked Question &
Answers Here

Q1. What is the difference between Quadruple Witching and Triple Witching?

Quadruple Witching originally involved the simultaneous expiry of four types of derivatives: stock options, stock index options, stock index futures, and single-stock futures. Since Single-Stock Futures have been discontinued in the US since 2020, the event now involves only three, thus the correct term is Triple Witching

Q2. Why is it called ‘Witching’?

The term 'witching' refers to the mystery and chaos associated with witches in folklore. In trading, it describes the unpredictability and unusual volatility seen in markets during the last hour of trade on these days

Q3. How does Quadruple Witching affect Indian markets?

While the event happens in the US markets, its effects can spill over to global markets like India. Increased volatility and sharp moves are often observed in Indian indices one day before and one day after the event due to global portfolio adjustments.

Q4. Can retail traders benefit from Quadruple Witching days?

For experienced traders, heightened volatility can offer trading opportunities. However, for inexperienced or long-term investors, it’s generally advisable to stay cautious during these periods due to unpredictable price swings.

Q5. How can I track when Quadruple or Triple Witching is happening?

You can mark your calendar for the third Friday of March, June, September, and December each year. Financial news portals and market calendars also usually highlight these dates.