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Strategies & Market Trends : The coming US dollar crisis -- Ignore unavailable to you. Want to Upgrade?

To: bruiser98 who wrote (845)	8/31/2007 8:43:45 AM
From: stan_hughes	Respond to of 71456

If you mean what happens to all the underlying in the context of whether or not there's a tsunami of stock coming at you, all contracts have to unwind by expiry either by the closing out of the open position or triggering delivery by exercise/assignment. If, like Vi says, these positions are hedged against other contracts (likely), the holder could just close out the entire open interest on both sides -- in which case that's the end of it, there's nothing left to hit the market in either direction. OTOH let's say that's not the case, in which instance there would be a massive transfer to the ITM side of the hedge to the assignee(s) at expiry -- but nothing further necessarily has to happen at that point either, because the assignee(s) might choose to stay in their newly acquired positions for 1, 3, 10, 30 days or 2, 5, 10, 20 years -- who's to know -- they might not even know themselves yet how long they want to hold. The whole topic is a tempest in a teapot in my opinion -- that was the original point I was trying to make