A total of approximately $10.95 billion worth of Bitcoin (BTC) and Ethereum (ETH) options are set to expire on the last Friday of November.
According to data from Deribit, one of the largest exchanges, 98 thousand Bitcoin contracts worth a total of $9.48 billion are expiring today. The put call ratio of these options is 0.84, while the maximum pain level is $80 thousand.
Max pain is the strike price that has the most open option contracts. This is the price that will cause the largest number of option holders to suffer financial losses when the options expire. The put-call ratio is the ratio between the call options and the put options in the market.
In addition to Bitcoin, 412,000 Ethereum contracts worth more than $1.47 million are also expiring. Their put call ratio is 0.75 and the maximum pain level is $2,900.
Institutional investors cautious
While 20 percent of total positions expire at the end of November, this rate will increase to 40 percent in December. The expiration of year-end options could cause position changes in the market and particularly put pressure on implied volatility.
“The market is currently in a very optimistic mood. However, in the options market, institutional investors appear to be cautious. This is causing institutions to adopt a more cautious strategy, remembering the volatility at the end of 2020,” derivatives analyst Greeks.live said.