I'm really not understanding how someone could manipulate index futures (or options on futures, which, in the US, are subject to stock-type settlement). The "F

I'm really not understanding how someone could manipulate index futures (or options on futures, which, in the US, are subject to stock-type settlement). The "Final Settlement" on an index future is determined by the settled value of the underlying index. Any discrepency between the index future and the underlying index near expiration would result in an easy arbitrage opportunity. Are you implying that, close to expiration, a large player would move the index, in order to move their option position in the money? In the case of ES, that would imply buying an impossibly large of amount of SP500 assets---which they would have to liquidate at some point after the ES settlement or liquidation... Also not understanding your point on pin risk, pinning is the result of maintaining a delta neutral hedge, which is a well known strategy...