Why in some FNO expiry days Nifty & BNifty are volotile and some expiry days are muted…most expiry days big movement which usually happens after 2.30 PM or so in my observation…Is there any ways to predict that which expiry day will be volatile…
Can we expect any difference in this volatility between weekly and monthly expiry days(Is it safe to assume weekly expiry days will be less volatile than monthly ones)…
There could be many reasons for this, as the expiry date action also gets affected by the type of news flow and the overall market sentiments which was prevailing in the Indian and the overall World Markets at that time.
Other then this, what could be a major differentiator for volatile vs non volatile market activity on any given expiry date, might be the type of MONEY that is at stake and the type and nature of those guys, who have huge bets open on that particular date.
Suppose if there was a VERY BIG GROUP of Traders “Institutional or otherwise” who have formed very specific positions into the Options, which would benefit tremendously if the expiry happens above or below a certain price level, then they would try their best to effect the expiry price. And this would get reflected into huge volume and volatility on that particular date. These BIG GUYS would literally fight in the market order book, in order to try to move the price in their favorable direction.
But suppose, there is some other expiry date, when such guys do not have any such specific commitment in terms of huge money amount at stake, then they would be least bothered, where the expiry happens and as a result, there would be lesser activity and volatility on that particular expiry date.
Such scenarios do not happen on every single expiry date.
This is just a speculation from my side and it could be wrong. Experienced traders can guide us better regarding what could be actual reasons.
Thanks and regards.
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