Skip to main content
Learn

What Is the Main Risk Associated with the Final Settlement Price of a Cash-Settled Contract?

Risk of manipulation or extreme volatility at the precise time and price used for final settlement calculation.
Greeks.Live21.11.25

What Is the Main Risk Associated with the Final Settlement Price of a Cash-Settled Contract?

The main risk is manipulation or volatility around the specific time and price used to determine the final settlement value. If the settlement price is based on an average of prices from a few exchanges at a precise time, a sudden price spike or drop can disproportionately affect the final cash payment.

This risk is known as "settlement risk" or "fixing risk." Traders must monitor the methodology for calculating the final settlement price.

How Does a Physically Settled Crypto Future Differ in Tax Timing from a Cash-Settled One?
What Is the Primary Difference between Cash-Settled and Physically-Settled Futures?
What Is the Difference between Physically-Settled and Cash-Settled Crypto Options?
What Is the Primary Difference between Cash-Settled and Physically-Settled Crypto Futures?

About

Contact

Editorial Policy

Terms of Service

Privacy Policy

Cookie Policy

© 2025 Greeks.Live

All Rights Reserved

Greeks.Live RFQ

Build by Noo on Engine

Source: The content on this website is produced by Greeks.live's proprietary analysis systems, which utilize advanced Large Language Models (LLMs). This information might not be subject to a full human review before publication and may contain errors.
Responsibility: You should not make any financial decisions based solely on the content presented here. We strongly urge you to conduct your own rigorous due diligence and to consult a qualified, independent financial advisor.
Purpose: All information is intended for informational purposes only. It should not be construed as financial, investment, trading, or any other form of professional advice. News and data are not trading signals.
Risk: The cryptocurrency, derivatives, and options markets are highly volatile and carry significant risk. By using this site, you acknowledge these risks and agree that Greeks.live and its affiliates are not responsible for any financial losses you may incur.