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In finance, the expiration date of an option contract (represented by Greek letter tau, τ) is the last date on which the holder of the option may exercise it according to its terms. [1] In the case of options with "automatic exercise", the net value of the option is credited to the long and debited to the short position holders.
Contract name: This is the official code for the specific option, including its ticker symbol, expiration date, option type and strike price. Last trade date: ...
When an option is exercised, the cost to the option holder is the strike price of the asset acquired plus the premium, if any, paid to the issuer. If the option's expiration date passes without the option being exercised, the option expires, and the holder forfeits the premium paid to the issuer.
For example, the Apple mini-options symbol is AAPL7. [6] Examples: AAPL7 131101C00470000. The above symbol represents a mini call option (10 shares) on AAPL, with a strike price of $470, expiring on Nov 1, 2013. AAPL 131101C00470000. The above symbol represents the standard call option (100 shares), with the same strike and expiration date.
The options trader makes a profit of $200, or the $400 option value (100 shares * 1 contract * $4 value at expiration) minus the $200 premium paid for the call.
A compound option is an option on another option, and as such presents the holder with two separate exercise dates and decisions. If the first exercise date arrives and the 'inner' option's market price is below the agreed strike the first option will be exercised (European style), giving the holder a further option at final maturity.
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