Options Expiration Explained
Unlike traditional stock investing, all options contracts have a limited lifespan and a definitive "end date" or “expiration date” at which point they become worthless or are exercised. We'll talk briefly about the 2 major types of option styles: American-Style and European-Style contracts, as well as some major expiration cycles to consider. It's also important to know that less than 10% of options are ever exercised during the month. And of those roughly 10% that are, they are typically exercised in the last week of expiration. This means you have very little risk of being assigned on a short option throughout the month.