Non-Standard Expiring Options

What are non-standard expiring options?

“Standard” expiring options at Schwab are classified as options that expire on the Saturday following the third Friday of the month, and have a lifespan of months or years. These have been the norm in the industry for many years. However, options on certain stocks, ETFs, ETNs and indices are now available with short term expirations (weekly expiring options) and calendar quarter end expirations (quarterly expiring options.) These are being referred to as “Non-Standard Expiring Options”.

What are the types of non-standard expiring options?

Schwab currently has two broad categories of non-standard expiring options available for trading:

Weekly expiring options

Weekly expiring options expire on Fridays, except during the expiration week for regular options (the third Friday of each month), and typically have a lifespan of 7-8 days. They are generally created on Thursdays and cease trading the Friday of the following week (Thursday in the case of AM settled options.)

Weekly expiring options may provide traders with more flexibility when assessing targeted trading opportunities.

Not all stocks, ETFs nor indices trade weekly expiring options – the number is currently limited. You can get the most updated list from the Options Clearing Corporation.

Quarterly expiring options

Quarterly expiring options expire on the last business day of the following calendar quarter ending months: March, June, September, and December. These options are generally created as far as 6 quarters in advance of their expiration, and their last trading day is typically on the day they expire.

Quarterly expiring options may provide traders the ability to align their trading strategies to the calendar or business ending quarters.

How do I find and trade non-standard expiring options?

Schwab.com Page Help: You can search for non-standard expiring options in many ways. From within the Option Chains page, when an underlying security has non-standard expiring options associated with it, a “Show Non-Standard Expirations” checkbox will appear next to the Expiration filters. Checking this checkbox will display any Weekly or Quarterly expiring options for the currently selected months. A similar mechanism exists on the interactive tool provided on the order entry pages, research pages and Quick Quote.

StreetSmart Applications Help: You can search for non-standard expiring options in many ways. From the Options chains, when an underlying security has non-standard expiring options associated with it, then they will be listed along with the standards options. If the expiration day is not the Saturday following the third Friday, then they will be either weeklys or quarterlys. An exception to all nonstandards expiring on days other than the Saturday following the third Friday are the following Volatility based index options ($VIX, $GVZ, $OVZ).

 

Options carry a high level of risk and are not suitable for all investors. Certain requirements must be met to trade options through Schwab. Please read the options disclosure document titled Characteristics and Risks of Standardized Options.