Expiration (options)

For an option contract, expiration is the date on which the contract expires. The option holder must elect to exercise the option on or before the expiry date or allow it to expire worthless.

Typically, traded option contracts expire according to a pre-determined calendar. For instance, for U.S. exchange-listed equity monthly option contracts, the expiration date is always the Saturday that follows the third Friday of the month, unless that Friday is a market holiday, in which case the expiration is on the Friday.

The clearing firm may automatically exercise by exception any option that is in the money at expiration to preserve its value for the holder of the option. However the holder or the holder's broker may request that the options are not exercised automatically. Out of the money options are not exercised automatically.

If the option is not exercised, upon expiration any margin charged by the clearing firm to the holder or writer of the option is released. The margin may then be used for any purpose, for instance to finance subsequent option trades.

External links

• The Options Clearing Corporation - Option Expiration Calendar
• Options calendar Futures Expiration calendar

See Also

• Options Screeners