AshBax Posted December 3, 2021 Posted December 3, 2021 Hi, I'm looking to see if anyone publishes data on early exercise of options. Particularly I'm looking at the quarterly expiry of S&P and Nasdaq options. If I'm short of a put or call option that is slightly in the money, is the holder more likely to close their position or exercise the option? Many thanks Quote
zxcv64 Posted December 3, 2021 Posted December 3, 2021 (edited) @Ashbax, S&P options are European style so they cannot be exercised early, even if they are ITM. I believe NASDAQ are also European. I trade a lot of SPX options, and being European-style and cash-settled are two very useful benefits for me. I've often been short of an option that is several hundred points ITM and I know that I don't need to roll till expiry if required. (Being naked with short options is not something I want to do again, or recommend.) However, pls not that if you trade SPY or QQQ (to mirror S&P or Nasdaq), then these are American style, and CAN be exercised at any time, and are stock-settled. Edited December 3, 2021 by zxcv64 Quote
AshBax Posted December 3, 2021 Author Posted December 3, 2021 58 minutes ago, zxcv64 said: @Ashbax, S&P options are European style so they cannot be exercised early, even if they are ITM. I believe NASDAQ are also European. I trade a lot of SPX options, and being European-style and cash-settled are two very useful benefits for me. I've often been short of an option that is several hundred points ITM and I know that I don't need to roll till expiry if required. (Being naked with short options is not something I want to do again, or recommend.) However, pls not that if you trade SPY or QQQ (to mirror S&P or Nasdaq), then these are American style, and CAN be exercised at any time, and are stock-settled. Hi thanks for the quick response. The E-min S&P quarterly options are American, all the monthly/weekly are European. https://www.cmegroup.com/markets/equities/sp/e-mini-sandp500.contractSpecs.options.html#optionProductId=138 For those, I'm wondering if you're short the option what the chances of these being exercised early (assuming its ITM) best regards Quote
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