Yea, by expire I literally mean the time when I the option purchaser can last exercise it, or the last point when I the option writer have to worry about the option purchaser possibly exercising it. Sounds like that it 5:30 ET on the day the option expires for U.S. equity options.
You're confusing the time that options stop trading in the cash market with expiration. They are not the same. What time of day does option expire? According to NASDAQ, options technically expire at 11:59 AM Eastern Standard time on the date of expiration, which is a Saturday, oddly enough. Public holders of options contracts, however, must indicate their desire to trade no later than 5:30 PM on the business day preceding the option expiration date. Do options expire at 4pm? Keep in mind that most stock options stop trading at 4:00 pm ET when the regular stock market session closes, but many stocks continue to trade after hours until 8:00 pm ET, even on expiration Friday, which may affect the intrinsic value and possibly the decision of a call or put option buyer to exercise an option. What does the expiration time on an option mean? The expiration time of an options contract is the date and time when it is rendered null and void. It is more specific than the expiration date and should not be confused with the last time to trade that option. What is the definition of the expiration date? The Nasdaq offers a more detailed definition: “The expiration time is the time of day by which all exercise notices must be received on the expiration date.
Technically options now expire on Friday evening, not Saturday. A change that was made several years ago. From the CBOE The expiration date for equity options is the Saturday immediately following the third Friday of the expiration month until February 15, 2015. On and after February 15, 2015, the expiration date will be the third Friday of the expiration month. Equity Options Specifications (cboe.com) The OCC response to this question is "the deadline to notify the OCC for contrary exercise instructions is 530pm et (or 1 hour 30 minutes after the close). The OCC then tabulates the information and notifies member firms of the results some time before 11:59pm when the options technically expire." Note that in the OCC bylaws there are some extreme exceptions that allow a firm to go beyond this deadline. For all intents and purposes, while the 530pm time may not be the technical expiration time, it is the time when the option can no longer be used.
Does that actually happen? I've heard about that... hmph. __________________________________________ You guys are so smart. Here's a question... What happens on an A.M. expiration index option when one of the the stocks in the index is halted for volatility? What time would they expire? Wrap your brains around that one and get back to us.