Expiration Time

The third Saturday of the expiration month at 11:59 p.m. EST

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What is Expiration Time (in Options)?

Expiration time in options trading occurs on the third Saturday of the expiration month at 11:59 a.m. EST. The expiration time is not to be confused with the last day to trade options, which is the third Friday of the expiration month. The expiration time is the moment when the option becomes void and can no longer be used.

Expiration Time


  • The expiration time is when the options contract becomes void and no longer carries any value. Usually, the last day of trading is the third Friday of the month. However, the actual expiration time is the following Saturday at 11:59 a.m. EST.
  • The expiration time and dates can differ when a broker is used and can also depend on the exchange the option is traded on.
  • When an option is not exercised as it nears the expiration date, it can become important to watch the after-hours trading based on several risk factors.

Understanding Expiration Times

The expiration time is not to be confused with the expiration date. The expiration date is the last time for the owner of the option to exercise said option meaning the exercise notice must’ve been received on that date for it to be effective. It means the intentions of the holder of that option must be known on or before the expiration date.

It should be noted that expiration times and dates can be different when investors go through a broker. The times can range from half an hour to several hours early to give the broker time to carry out their client’s request. The discrepancy between the two depends on the broker and their predetermined set of rules. Ultimately, it allows the broker time to give the exchange notice of the option holders’ intent before the time of expiry. As well, the times can vary depending on which exchange the option is being traded on.

Most options contracts never reach their expiration date because traders will close their positions before such a time. Options that do live until their expiration time include more circumstances to consider than ones that do not.

What is Options Trading?

When trading options, the buyer is purchasing a contract that gives them the right, but not the obligation, to buy/sell a financial asset at a particular exercise price within a specific time period or on a specified date (expiration date).

  • call option is used to buy a security specified price and within a specified timeframe.
  • A put option is used to sell a security at a specified price and within a specified timeframe. The holder must exercise the option by the expiration date. The holder will pay a premium on the option to receive the rights given by the contract.

What is After-Hours Trading?

After-hours trading is important to keep in mind when participating in options trading. It starts after 4:00 p.m. EST when the U.S. stock exchange closes. It will usually continue until 8:00 p.m. with a decreasing volume of trades over that time.

After-hours trading comes with substantial risk due to most stocks’ illiquidity at such a time, resulting in a greater bid-ask price range, otherwise known as a spread. Investors take part in this type of trading to try and take advantage of the latest news (e.g., earnings report, press release, etc.) or get out of a losing position early.

With after-hours trading taken into consideration, there are certain situations in which options traders should follow after-hours markets. For the most part, options that are in-the-money (ITM) will be automatically exercised at the closing market price. However, it is not mandatory, and investors can contact their clearing firm with an exception that can occur during after-hours trading.

For options holders who hold contracts at-the-money (ATM) or near-the-money, it can be worthwhile to monitor the after-hours market. Traders should also make their intentions clear with their broker and understand the exchange at which their option is trading.

More Resources

CFI offers the Capital Markets & Securities Analyst (CMSA)™ certification program for those looking to take their careers to the next level. To keep learning and advancing your career, the following resources will be helpful:

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