Options Concepts - Expiration

When do options expire?

Expiration day for equity and index options is the Saturday immediately following the third Friday of the expiration month.

When is the last day to trade or exercise an equity option?

Although equity options literally expire on the third Saturday of the expiration month, a day reserved for brokerage firms and The Options Clearing Corporation to confirm customers' positions, the day expiring equity options last trade is the Friday before expiration, or the third Friday of the month. This is also generally the last day an investor may notify his brokerage firm of his intent to exercise an expiring equity call or put. If this third Friday happens to be an exchange holiday, then the last day of trading for expiring equity options is the day before, or the third Thursday of the month. Check with your brokerage firm about its procedures and deadlines for instruction to exercise equity options.

When is the last day to trade an index option?

This depends on whether the option is American- or European-style:

For American-style index option contracts the last trading day is generally the third Friday of the expiration month, unless that day is an exchange holiday in which case the last trading day will be the previous day, or Thursday.

For European-style index option contracts the last trading day will be the business day (generally a Thursday) preceding the day on which the exercise settlement value is calculated (generally the third Friday of the month unless that day is a holiday).

When is the last day to exercise an index option?

An American-style index option may be exercised at any time prior to its expiration, or at any time up to and including the Third Friday of the expiration month. A European-style index option may be exercise only during a specific period of time just prior to its expiration - generally on the last Friday prior to its expiration date.