Options
Expiry Date — Definition & Example
The date after which the option contract no longer exists — value at expiry is purely intrinsic.
Every option has a finite life. At expiry, the option is exercised if it is ITM (and worth its intrinsic value) or expires worthless if OTM. As expiry approaches, time value (theta) decays — slowly far from expiry, then accelerating in the final days. Trading near expiry is high-leverage: small moves in the underlying produce large percentage changes in option value but the time decay makes wrong directional bets devastating.
Example
NIFTY weekly options expire every Thursday. A NIFTY 24500 CE bought on Monday for ₹100 may decay to ₹40 by Wednesday afternoon if the underlying doesn't move, even though the strike is unchanged.
Related
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