Option Expiration Dates

Discussion in 'SP6' started by Xu Shi, Nov 2, 2019.

  1. Xu Shi

    Xu Shi Keen member

    In section 10.4 (Hull's 9th - global), there are two paragraphs on expiration dates for options. I have a few questions as below.
    • What does the Jan, Feb, Mar cycles mean? What role does it play in trading? Does it means usually an option has 3-month term?
    • The text talks about the situation where the expiration date for the current month has not yet been reached and also the opposite situation. Is there a reason why such rule is needed and/or how such rule is derived?
    Thank you!

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