0DTE option contracts expire at the end of the trading day when the market closes. The exact time depends on the underlying security.
Options have different settlement timelines. Index options expire at exactly 4:00 p.m. EST and are cash-settled at the end of the day. Equity and ETF options expire at 4:15 p.m. EST and have physical settlement. Options for tickers like SPY and QQQ are subject to after-hours price changes in the underlying symbol between 4:00 and 4:15, which can impact the option contract’s value.
What happens when 0DTE options expire?
Index options, like SPX and XSP, are cash-settled at expiration, meaning all profit or loss is calculated using the underlying’s closing price at 4:00 pm EST. Index options are also European-style and can’t be exercised.
Equity and ETF options, like SPY and QQQ, settle into physical shares of the underlying. For example, if assigned an SPY short put, you would be obligated to buy 100 SPY shares per contract at the option’s strike price. Because equity options are American-style, they can be exercised any time before expiration.
If an option expires in-the-money, the broker will automatically exercise it and assign it to a seller randomly. Out-of-the-money options will expire worthless.
Can a 0DTE option be exercised and assigned after the market closes?
Index options can’t be exercised or assigned. Although the stock market closes at 4:00 p.m. EST and the option can no longer be traded after 4:15 p.m., equity options can be exercised until 5:30 p.m. EST.
Which Symbols Offer 0DTE Options?
Currently, five ticker symbols list daily options every day of the week:Â
- SPDR S&P 500 ETF Trust (SPY)
- Invesco QQQ Trust (QQQ)
- S&P 500 Index (SPX)
- S&P 500 Mini-SPX Index (XSP)
- Nasdaq 100 Index (NDX)
Any stock, index, or ETF will have a 0DTE option at least once per month since all options eventually expire and become 0DTE options on their final trading day, whether a weekly, monthly, or quarterly contract. The key difference with the tickers above is that they explicitly offer daily options Monday through Friday for 0DTE trading.
