🏦LTB
SIE: Options
SIE practice questionmediumOptions expiration

What is true at options expiration for American-style contracts?

  1. AThey may be exercised any time before or at expiration✓ Correct answer
  2. BThey may only be exercised on the expiration date
  3. CAssignment occurs only after expiration
  4. DExercised contracts are always settled for cash
Explanation

Why AThey may be exercised any time before or at expiration

American-style options can be exercised at any time before or on expiration. B describes European-style, C is inaccurate, D describes cash-settled index options.

Turn it into reps

Reading one answer is not the same as being ready

Lucky the Banker is a free practice app with 1,867+ SIE questions, weak-area tracking, and timed mock exams. No credit card, no paywall.

Related Options questions