Expiration Date

Expiration date

The last day (in the case of American-style) or the only day (in the case of European-style) on which an option may be exercised. For stock options, this date is the Saturday immediately following the third Friday of the expiration month; brokerage firms may set an earlier deadline for notification of an option holder's intention to exercise. If Friday is a holiday, the last trading day will be the preceding Thursday.

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expiration date

The last day on which an option holder may exercise an option. This date is stated in the contract at the time the option is written.

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Expiration Date

The date by which a contract is abandoned and becomes worthless unless an option is exercised. In an option contract, the holder has the right, but not the obligation, to buy or sell (depending on the type of option) the underlying asset within a certain period of time. The expiration date is the time at which the holder will lose the right to exercise the option. A European option can only be exercised on the expiration date, while an American option can be exercised at any point prior to the expiration date.

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Expiration date. The expiration date is the day on which an options contract expires and becomes worthless. Listed options always expire on the Saturday following the third Friday of their expiration month.

For example, if you hold an American-style September equity option, you can exercise it any time before the end of trading on the third Friday in September, or whatever cutoff time your brokerage firm sets. In contrast, European-style options can be exercised only at expiration, usually on Friday.

Under specific circumstances, listed options will be exercised automatically at expiration unless the owner gives instructions not to exercise them.

Unlike the standard term of a listed option, the expiration date of an over-the-counter option is negotiated at the time of the trade.

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Expiration Date

What Does Expiration Date Mean?

The day on which an option or futures contract is no longer valid and therefore ceases to exist.

Investopedia explains Expiration Date

The expiration date for all listed stock options in the United States is the third Friday of the expiration month (except when it falls on a holiday, in which case it is on Thursday).

Related Terms:
• Common Stock
• Maturity
• Option
• Stock Option
• Strike Price