Deep in the Money Options Expiring--What Happens? - Options on Futures | futures io social day trading
futures io futures trading


Deep in the Money Options Expiring--What Happens?
Updated: Views / Replies:2,244 / 11
Created: by TGoat Attachments:0

Welcome to futures io.

(If you already have an account, login at the top of the page)

futures io is the largest futures trading community on the planet, with over 90,000 members. At futures io, our goal has always been and always will be to create a friendly, positive, forward-thinking community where members can openly share and discuss everything the world of trading has to offer. The community is one of the friendliest you will find on any subject, with members going out of their way to help others. Some of the primary differences between futures io and other trading sites revolve around the standards of our community. Those standards include a code of conduct for our members, as well as extremely high standards that govern which partners we do business with, and which products or services we recommend to our members.

At futures io, our focus is on quality education. No hype, gimmicks, or secret sauce. The truth is: trading is hard. To succeed, you need to surround yourself with the right support system, educational content, and trading mentors – all of which you can find on futures io, utilizing our social trading environment.

With futures io, you can find honest trading reviews on brokers, trading rooms, indicator packages, trading strategies, and much more. Our trading review process is highly moderated to ensure that only genuine users are allowed, so you don’t need to worry about fake reviews.

We are fundamentally different than most other trading sites:
  • We are here to help. Just let us know what you need.
  • We work extremely hard to keep things positive in our community.
  • We do not tolerate rude behavior, trolling, or vendors advertising in posts.
  • We firmly believe in and encourage sharing. The holy grail is within you, we can help you find it.
  • We expect our members to participate and become a part of the community. Help yourself by helping others.

You'll need to register in order to view the content of the threads and start contributing to our community.  It's free and simple.

-- Big Mike, Site Administrator

Reply
 
Thread Tools Search this Thread
 

Deep in the Money Options Expiring--What Happens?

  #11 (permalink)
Trading Apprentice
Las Vegas NV/Clark
 
Futures Experience: Intermediate
Platform: IB
Favorite Futures: Options
 
Posts: 13 since Oct 2014
Thanks: 5 given, 1 received


ACstudio View Post
Owning the contracts gives you the right to sell them or buy the stock at the strike price. It's a contract....to do with as you please. Like a coupon for a 2$ pizza....if you don't use it or sell it before it expires it isn't of any use to anybody.

However most brokerages will auto exercise any contracts that are in the money at 4pm Fri of expiration...even if you don't have the money to cover the position...and then give you 2-3 days to liquidate or add cash to hold the position...so that you don't lose your entire investment....what else could you ask for?

I never take an option to expiration unless it's worthless. I always take profits before expiration...usually 7-10 days before expiration, if possible, to avoid the spike in Gamma risk.

Selling or buying them back before expiration for a profit is is what most of us try to do....that's the goal most of the time.

Thanks, appreciate it. While I've got you here I have another question about a RUT vertical that just expired on Mar 5. It was a +1200/-1220 put vertical. Do these types of derivitaves settle the next day? How exactly does that work?

Reply With Quote
 
  #12 (permalink)
Trading Apprentice
Nashville TN/USA
 
Futures Experience: Intermediate
Platform: Thinkorswim
Favorite Futures: Derivatives
 
Posts: 35 since Nov 2014
Thanks: 0 given, 32 received


TGoat View Post
Thanks, appreciate it. While I've got you here I have another question about a RUT vertical that just expired on Mar 5. It was a +1200/-1220 put vertical. Do these types of derivitaves settle the next day? How exactly does that work?

Ye that should have settled on the 6th as it expired on the 5th.....so it should have expired worthless giving you max profit. Be very careful carrying these into expiration...as you can see if it were like a normal option and expired on Fri and was not cash settled you would have ended up with it expiring between your strikes which is not where you want to be. Just as a rule, until you have a better understanding of how these work...do not carry anything into expiration that even looks like it could move to where it expires between your strikes.

Also...closing the trade before expiration and taking profits allows you to move the capital into another trade so as to not lose out on the weekend.

Reply With Quote
The following 2 users say Thank You to ACstudio for this post:

Reply



futures io > > > > Deep in the Money Options Expiring--What Happens?

Thread Tools Search this Thread
Search this Thread:

Advanced Search



Upcoming Webinars and Events (4:30PM ET unless noted)

Linda Bradford Raschke: Reading The Tape

Elite only

Adam Grimes: TBA

Elite only

NinjaTrader: TBA

January

Ran Aroussi: TBA

Elite only
     

Similar Threads
Thread Thread Starter Forum Replies Last Post
In a deep depression would there still be markets to trade? burn8 Traders Hideout 6 January 25th, 2015 08:51 PM
Money management: futures vs options jjsshh Psychology and Money Management 4 March 20th, 2014 08:26 PM
Why IPOs Look to Be Entering a Slow Deep Freeze for Now Quick Summary News and Current Events 0 November 25th, 2012 03:10 PM
The Rot Runs Deep 3: The Capture of the Professional Class kbit News and Current Events 0 August 29th, 2012 06:20 PM
Drug prices to plummet in wave of expiring patents kbit News and Current Events 0 July 25th, 2011 12:12 PM


All times are GMT -4. The time now is 04:00 PM.

Copyright © 2017 by futures io, s.a., Av Ricardo J. Alfaro, Century Tower, Panama, +507 833-9432, info@futures.io
All information is for educational use only and is not investment advice.
There is a substantial risk of loss in trading commodity futures, stocks, options and foreign exchange products. Past performance is not indicative of future results.
no new posts
Page generated 2017-12-12 in 0.08 seconds with 19 queries on phoenix via your IP 54.163.210.170