Why do some symbols not have an Options chain for specific expiration dates?
Short answer: Liquidity. Well, you have to see it from an exchange's point of view.  Every contract they put up is a liability to them.  You have to allocate resources for the order book, the matching engine, the clearing, etc.  But only if the contract is actually trading they start earning (the big) money. Now for every new expiry they engage a long term commitment and it might take years for an option chain to be widely accepted (and hence before they're profitable).  Compare the volumes and open interests of big chains versus the weeklies and you'll find that weeklies can still be considered illiquid compared to their monthly cousins. Having said that, like many things, this is just a question of demand.  If there's a strong urge to trade July weeklies one day, there will be an option chain.  But, personally I think, as long as there are the summer doldrums there will be no rush to ask for Jul and Aug chains. The answer is actually very simple: the cost of data. Seriously. Call the CBOE tomorrow and ask yourself. They have two big programs:  1) the penny pilot program, where options trade at penny increments instead of 5 cent increments. This is only extended to a select few symbols because of the amount of data this can generate is too much for the data vendors. Data vendors store and sell historical data. The exchanges themselves often have a big data vending business too. 2) the weekly options program, where only select symbols get these chains because of the amount of data they will generate. Liquidity and demand are factors in determining if the CBOE will consider enabling those series on new issues. (although they have to give the list of which symbols are on these programs to the SEC) All openly traded securities must be registered with the SEC and setup with clearing agents.  This is a costly process. The cost to provide an electronic market for a specific security is negligible.  That is why the exchange fees per electronic trade are so small per security.  It is so small in fact that exchanges compensate price makers partially at the expense of price takers, that exchanges partially give some portion of the overall fee to those that can help provide liquidity. The cost to provide an open outcry market for a specific security are somewhat onerous, but they are initiated before a security has any continual liquidity to provide a market for large trades, especially for futures. Every individual option contract must be registered and setup for clearing. Aside from the cost to setup each contract, expiration and strike intervals are limited by regulation.  For an extremely liquid security like SPY, contracts could be offered for daily expiration and penny strike intervals, but they are currently forbidden.
I have held an in the money long position on an option into expiration, on etrade, and nothing happened.   (Scalping expiring options - high risk) The option expired a penny or two ITM, and was not worth exercising, nor did I have the purchasing power to exercise it. (AAPL) From etrade's website: Here are a few things to keep in mind about exercises and assignments: Equity options $0.01 or more in the money will be automatically   exercised for you unless you instruct us not to exercise them. For   example, a September $25 call will be automatically exercised if the   underlying security's closing price is $25.01 or higher at expiration.   If the closing price is below $25.01, you would need to call an   E*TRADE Securities broker at 1-800-ETRADE-1 with specific instructions   for exercising the option. You would also need to call an E*TRADE   Securities broker if the closing price is higher than $25.01 at   expiration and you do not wish to exercise the call option. Index   options $0.01 or more in the money will be automatically exercised for   you unless you instruct us not to exercise them. Options that are out   of the money will expire worthless. You may request to exercise   American style options anytime prior to expiration. A request not to   exercise options may be made only on the last trading day prior to   expiration. If you'd like to exercise options or submit   do-not-exercise instructions, call an E*TRADE Securities broker at   1-800-ETRADE-1. You won't be charged our normal fee for   broker-assisted trades, but the regular options commission will apply.   Requests are processed on a best-efforts basis.  When equity options are exercised or assigned, you'll receive a Smart   Alert message letting you know. You can also check View Orders to see   which stock you bought or sold, the number of shares, and the strike   price.  Notes: If you do not have sufficient purchasing power in your account   to accept the assignment or exercise, your expiring options positions   may be closed, without notification, on the last trading day for the   specific options series. Additionally, if your expiring position is   not closed and you do not have sufficient purchasing power, E*TRADE   Securities may submit do-not-exercise instructions without   notification. Find out more about options expiration dates. "Seems like you are concerned with something called assignment risk. It's an inherent risk of selling options: you are giving somebody the right, but not the obligation, to sell to you 100 shares of GOOGL. Option buyers pay a premium to have that right - the extrinsic value. When they exercise the option, the option immediately disappears. Together with it, all the extrinsic value disappears. So, the lower the extrinsic value, the higher the assignment risk. Usually, option contracts that are very close to expiration (let's say, around 2 to 3 weeks to expiration or less) have significantly lower extrinsic value than longer option contracts. Also, generally speaking, the deeper ITM an option contract is, the lower extrinsic value it will have. So, to reduce assignment risk, I usually close out my option positions 1-2 weeks before expiration, especially the contracts that are deep in the money. edit: to make sure this is clear, based on a comment I've just seen on your question. To ""close out an options position"", you just have to create the ""opposite"" trade. So, if you sell a Put, you close that by buying back that exact same put. Just like stock: if you buy stock, you have a position; you close that position by selling the exact same stock, in the exact same amount. That's a very common thing to do with options. A post in Tradeking's forums, very old post, but with an interesting piece of data from the OCC, states that 35% of the options expire worthless, and 48% are bought or sold before expiration to close the position - only 17% of the contracts are actually exercised! (http://community.tradeking.com/members/optionsguy/blogs/11260-what-percentage-of-options-get-exercised) A few other things to keep in mind: certain stocks have ""mini options contracts"", that would correspond to a lot of 10 shares of stock. These contracts are usually not very liquid, though, so you might not get great prices when opening/closing positions you said in a comment, ""I cannot use this strategy to buy stocks like GOOGL""; if the reason is because 100*GOOGL is too much to fit in your buying power, that's a pretty big risk - the assignment could result in a margin call! if margin call is not really your concern, but your concern is more like the risk of holding 100 shares of GOOGL, you can help manage that by buying some lower strike Puts (that have smaller absolute delta than your Put), or selling some calls against your short put. Both strategies, while very different, will effectively reduce your delta exposure. You'd get 100 deltas from the 100 shares of GOOGL, but you'd get some negative deltas by holding the lower strike Put, or by writing the higher strike Call. So as the stock moves around, your account value would move less than the exposure equivalent to 100 shares of stock." "Below I will try to explain two most common Binomial Option Pricing Models (BOPM) used. First of all, BOPM splits time to expiry into N equal sub-periods and assumes that in each period the underlying security price may rise or fall by a known proportion, so the value of an option in any sub-period is a function of its possible values in the following sub period. Therefore the current value of an option is found by working backwards from expiry date through sub-periods to current time. There is not enough information in the question from your textbook so we may assume that what you are asked to do is to find a value of a call option using just a Single Period BOPM. Here are two ways of doing this: First of all let's summarize your information: Current Share Price (Vs) = $70 Strike or exercise price (X) = $60 Risk-free rate (r) = 5.5% or 0.055 Time to maturity (t) = 12 months Downward movement in share price for the period (d) = $65 / $70 = 0.928571429 Upward movement in share price for the period (u) = 1/d = 1/0.928571429 = 1.076923077 ""u"" can be translated to $ multiplying by Vs => 1.076923077 * $70 = $75.38 which is the maximum probable share price in 12 months time. If you need more clarification here - the minimum and maximum future share prices are calculated from stocks past volatility which is a measure of risk. But because your textbook question does not seem to be asking this - you probably don't have to bother too much about it yet. Intrinsic Value: Just in case someone reading this is unclear - the Value of an option on maturity is the difference between the exercise (strike) price and the value of a share at the time of the option maturity. This is also called an intrinsic value.  Note that American Option can be exercised prior to it's maturity in this case the intrinsic value it simply the diference between strike price and the underlying share price at the time of an exercise. But the Value of an option at period 0 (also called option price) is a price you would normally pay in order to buy it. So, say, with a strike of $60 and Share Price of $70 the intrinsic value is $10, whereas if Share Price was $50 the intrinsic value would be $0. The option price or the value of a call option in both cases would be fixed.  So we also need to find intrinsic option values when price falls to the lowest probable and rises to the maximum probable (Vcd and Vcu respectively) (Vcd) = $65-$60 = $5 (remember if Strike was $70 then Vcd would be $0 because nobody would exercise an option that is out of the money) (Vcu) = $75.38-$60 = $15.38 1. Setting up a hedge ratio:  h = Vs*(u-d)/(Vcu-Vcd) h = 70*(1.076923077-0.928571429)/(15.38-5) = 1 That means we have to write (sell) 1 option for each share purchased in order to hedge the risks. You can make a simple calculation to check this, but I'm not going to go into too much detail here as the equestion is not about hedging. Because this position is risk-free in equilibrium it should pay a risk-free rate (5.5%). Then, the formula to price an option (Vc) using the hedging approach is: (Vs-hVc)(e^(rt))=(Vsu-hVcu) Where (Vc) is the value of the call option, (h) is the hedge ratio, (Vs) - Current Share Price, (Vsu) - highest probable share price, (r) - risk-free rate, (t) - time in years, (Vcu) - value of a call option on maturity at the highest probable share price. Therefore solving for (Vc): (70-1*Vc)(e^(0.055*(12/12))) = (75.38-1*15.38) => (70-Vc)*1.056540615 = 60 => 70-Vc = 60/1.056540615 => Vc = 70 - (60/1.056540615)  Which is similar to the formula given in your textbook, so I must assume that using 1+r would be simply a very close approximation of the formula above. Then it is easy to find that Vc = 13.2108911402 ~ $13.21 2. Risk-neutral valuation: Another way to calculate (Vc) is using a risk-neutral approach. We first introduce a variable (p) which is a risk-neutral probability of an increase in share price. p = (e^(r*t)-d)/(u-d) so in your case: p = (1.056540615-0.928571429)/(1.076923077-0.928571429) = 0.862607107 Therefore using (p) the (Vc) would be equal: Vc = [pVcu+(1-p)Vcd]/(e^(rt)) => Vc = [(0.862607107*15.38)+(0.137392893*5)]/1.056540615 => Vc = 13.2071229185 ~ $13.21 As you can see it is very close to the hedging approach. I hope this answers your questions. Also bear in mind that there is much more to the option pricing than this. The most important topics to cover are: Multi-period BOPM Accounting for Dividends Black-Scholes-Merton Option Pricing Model" http://dailyfinance.com Enter a stock ticker, then click on the Chain link to the left. Then, click on the option tickers to see their charts. EDIT: the site has changed, and there are no more option charts. So why are option charts so tough to find? Options are derivatives of the stock. Option prices are defined by a formula. The inputs are stock pricxe, strike, days to expiration, dividend, risk-free interest rate, and volatility. Volatility is the only thing that cannot be easily looked up. With a Black-Scholes calculator, and some reasonable volatility selections, it's possible to make your own fairly accurate option chart. I don't think it's very enlightening, though. The interesting things are: the stock price movement (as always), and the nature of option pricing behavior in general (understanding how the formula represents crowd behavior). "There are two reasons why most options aren't exercised.  The first is obvious, and the second, less so. The obvious: An option that's practically worthless doesn't get exercised. Options that reach expiry and remain unexercised are almost always worthless bets that simply didn't pay off. This includes calls with strikes above the current underlying price, and puts with strikes below it. A heck of a lot of options. If an option with value was somehow left to expire, it was probably a mistake, or else the transaction costs outweighed the value remaining; not quite worthless, but not ""worth it"" either. The less obvious: An option with value can be cancelled any time before expiration. A trader that buys an option may at some point show a gain sooner than anticipated, or a loss in excess of his tolerance. If a gain, he may want to sell before expiry to realize the gain sooner. Similarly, if a loss, he may want to take the loss sooner. In both cases, his capital is freed up and he can take another position. And — this is the key part — the other end matched up with that option sale is often a buyer that had created (written) exactly such an option contract in the first place – the option writer – and who is looking to get out of his position. Option writers are the traders responsible, in the first place, for creating options and increasing the ""open interest.""  Anybody with the right kind and level of options trading account can do this. A trader that writes an option does so by instructing his broker to ""sell to open"" a new instance of the option. The trader then has a short position (negative quantity) in that option, and all the while may be subject to the obligations that match the option's exercise rights. The only way for the option writer to get out of that short position and its obligations are these: Not by choice:  To get assigned. That is to say: a buyer exercised the option. The writer has to fulfill his obligation by delivering the underlying (if a call) to the option holder, or buying the underlying (if a put) from the option holder. Not by choice: The option expires worthless. This is the ideal scenario for a writer because 100% of the premium received (less transaction costs) is profit. By choice: The writer is free to buy back exactly the same kind of option before expiry using a ""buy to close"" order with their broker. Once the option has been purchased with a ""buy to close"", it eliminates the short position and obligation.  The option is cancelled.  The open interest declines. Options thus cancelled just don't live long enough to either expire or be exercised." "If the strike price closest to the underlying has high open interest, the options expiration is a bigger event.   For instance:  stock is at $20 w/ average volume of 100,000 shares per day.    20 strike has 1000 open interest.   In this example the stock will ""most likely"" pin at 20 if we were expiring tomorrow.     As u prob know, long calls at 19.90 close, turn into stock....long puts at 20.10 turn into short stock.   Option pros (high % of volume) dont want to be short or long after expiration.   Long call holders will sell above 20 to hedge, and long put holders will buy below 20.   1000 open interest is equivalent to 100,000 shares.   That's the same amount as the average volume.   Stock can't really move until after expiration.   If I am long 10 $20 calls, and short 1000 shares I am flat going into expiration.....unless the stock gets smoked and now I am synthetically long a put....Short stock + long call= Long Put Then watch out cause it was artificially locked down." consider capital requirements and risk timeframes. With options, the capital requirements are far smaller than owning the underlying securities with stops. Options also allow one to constrain risk to a timeframe of ones own choosing (the expiration date of the contract). If you own or are short the underlying security, there is no time horizon. Not that I am aware. There are times that an option is available, but none have traded yet, and it takes a request to get a bid/ask, or you can make an offer and see if it's accepted. But the option chain itself has to be open. Options that are not worth exercising just expire. Options that are worth exercising are typically exercised automatically as they expire, resulting in a transfer of stock between the entity that issued the option and the entity that holds it. OCC options automatically exercise when they expire if the value of the option exceeds the transaction cost for the stock transfer (1/4 point to 3/4 point depending). The CBOE Rule Book, Section 5.5 explains exactly what programmes are available, how and when they will start listing and expire. The super-concise summary is: It's a per-underlying decision process, though there's some rules that may provide you with a minimum set of options (e.g. the quarterly programme on highly capitalised stocks trading for more than $75, etc.) For greater detail, for better or worse, you will have to scan the New Listings service regularly. The short answer to your initial question is: yes. The option doesn't expire until the close of the market on the day of expiration. Because the option is expiring so soon, the time value of the option is quite small.  That is why the option, once it is 'in-the-money', will track so closely to the underlying stock price. If someone buys an in-the-money option on the day of expiration, they are likely still expecting the price to go up before they sell it or exercise it. Many brokers will exercise your in-the-money options sometime after 3pm on the day of expiration.  If this is not what you desire, you should communicate that with them prior to that day. "The ex indicator is meant to be a help for market participants.  On the ex-day orders will go into a different order book, the ex order book, which at the start of the ex day will be totally empty, i.e. no orders from the non-ex day book have been copied over. Why does this help?  Well imagine you had a long-standing buy order in the book, well below the current price, and now the share price halves due to a 2-for-1 split, would you want to see your order executed? If so, your order should have gone into the ex-book which is only active on the ex-day (and orders in the ex book are usually copied over to the normal book on the day after the ex-day but this is exchange-specific). Think of it as an additional safety net to tell the exchange: ""I know what I'm doing: I want to buy this stock totally overpriced after the 2-for-1 split"". Now some exchanges and/or some securities (mostly derivatives) linked with the security in question don't have this notion of ex or the ex-book, and they will tell you by ""will not be quoted ex"" or ""the ex indicator is missing"". In your case (SNE) it is a sponsored ADR, the ex-date was Mar 28 2016, one day before the ex date of the Japanese original.  According to my understanding of NYSE rules, there is no specific rule for or against omitting the ex-indicator.  It seems to be a decision on a case by case basis.  Looking through the dividends of other Japanese ADRs I drew the conclusion none of them have an ex-book and so all of them are announced as: ""Will not be quoted ex by the exchange"".  Again, this is based on my observations." When you want the transaction to be concluded in the current year vs an expiration in the next year. You typically need to specify that you want the GTC order to be working during the Extended hours session. I trade on TD Ameritrade's Thinkorswim platform, and you can select DAY, GTC, EXT or GTC_EXT. So in your case, you would select GTC_EXT. Anyone with a background in finance should have been well aware that the government would swoop in with a bailout of the major banks. Such a scenario was even discussed in money and banking textbooks pre financial crisis.   Since I have no excess cash,  and wad in senior year of college, I was unable to capitalize on that, but I did invest in the banks in market simulating games 😁