Shares of Apple closed at 500 on Friday, Jan. 18. Not 499.99, not 500.01—five zero zero point zero zero dollars on the nose. There’s a long history of market watchers having cried conspiracy on Apple stock and for some observers, the impossibly round number was just too much of a coincidence. “I still have that bridge to sell you if you don’t think the fix was in on this,” wrote John Gruber an Apple uber-blogger.
“On option expiration days the nearest strike price works like a magnet for the price of the underlying asset,” Benjamin Golez, an assistant professor of finance at Notre Dame, wrote in an e-mail. “Since strike prices are round numbers (typically 5 or 10 apart), and equity options expire on the third Friday each month, pinning can thus help us understand why stocks on the third Friday of each month have a tendency to close near round numbers.”