Traders work on the floor of the New York Stock Exchange on December 17, 2025 in New York City, USA.
Brendan McDermid | Reuters
Wall Street could be in for a volatile end to the week as traders brace for what Goldman Sachs says will be the largest options expiry ever.
Option expirations occur every month on Wall Street when short-term derivatives contracts expire. Friday is one of the rare times (four times a year) when options on four types of securities expire on the same day: index options, single stock options, index futures and index futures options. This is known as the “fourfold witch day”.
According to Goldman, more than $7.1 trillion in notional options will expire this Friday, including about $5 trillion associated with them S&P 500 Index and $880 billion tied to individual stocks. December's options expiration is typically the largest of the year, but this one dwarfs all previous records, the company said.
To put the magnitude in context, the options expiring Friday represent notional exposure equal to about 10.2% of the Russell 3000's total market cap, Goldman said.
According to Jeff Kilburg, founder and CEO of KKM Financial, this dynamic could lead to choppy trading, particularly near closely watched S&P 500 levels.
“I expect volumes to be significantly above normal as options traders finalize their 2025 gains and losses,” Kilburg said. “But much of the repositioning appears to have already occurred. 6800 is a big strike price in the S&P and we will see if the bulls can defend that level after pushing the market back above it this morning.”
The S&P 500 is up about 15% this year and was trading at around 6,770 on Thursday.
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S&P 500 YTD
While the broader market may have seen increased volumes and volatility, a different scenario could emerge for individual stocks with large open interest. When options traders hedging their positions sit on a large amount of at-the-money options, the activity associated with the expiration of these contracts can actually calm price fluctuations rather than amplify them. Options that are “at-the-money” have strike prices that correspond to the current price of the underlying asset.
As traders adjust their hedges, prices can be pulled toward heavily traded strike levels, a phenomenon known as a “pin” that leaves stocks hovering near key levels until the close, Goldman noted.
“This situation is often referred to as a 'pin' and can be an ideal situation for a large investor trying to enter or exit a stock position,” Goldman said.
Stocks with options expiring on Friday that make up a large portion of their typical daily trading volume – and that could be prone to “pinning” – include GeneDx Holdings, BILL Holdings, Avis Budget Group And GameStopthe company noted.