I know it’s recommended to close out all equity options prior to Friday expiration on equity options, since long can still exercise based on 4-5 pm moves. Is this also true on gold and other futures options, in the hour after their expiration?
Is there an “after expiration” assignment risk on futures options also?
byu/thinkofanamefast inoptions
Posted by thinkofanamefast
3 Comments
Yes, it’s a good practice to close out futures options before expiration as well. While equity options can be exercised after the market close, futures options can also be influenced by price movements up until their expiration, potentially leading to unwanted assignments. To avoid any surprises, it’s usually safer to close your positions ahead of time. What’s your strategy when managing these positions near expiration?
No, they expire right when they stop trading.
There is no blanket rule. This depends entirely on the specifications for the particular futures options contract. While many contracts don’t allow contrary exercise instructions (which override the automatic exercise/abandonment process), many other contracts do allow them.
CME contact expiration specs can be found here [https://www.cmegroup.com/delivery_reports/option-products-and-unique-characteristics.csv](https://www.cmegroup.com/delivery_reports/option-products-and-unique-characteristics.csv)