May expiration is Friday the 18th. The last trading day for many cash-settled index options such as DJX, SPX, NDX and MNX options is tomorrow, Thursday, May 17th, with settlement prices determined by Friday morning’s opening prints for the component stocks. The last trading day for the OEX, XEO, ETFs and all equity options is Friday, May 18th.
The market makers have to make money. Check out the option interest for the various Strike prices for the SPX. If you look at the option table, here is how it works. If SPX closes at 1550 then the market makers will make money off every one in the non-grey area. Notice, the option interests for these areas. Hmmmmmmmmmmmmmmmmm
Where do you think the market makers what the SPX settlement price at?
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