Expiry Date and SettlementExpiry Date aur Settlement
Know when NIFTY options expire, how they are settled, and what happens to ITM and OTM options.NIFTY options kab expire hote hain, kaise settle hote hain, aur ITM/OTM options ka kya hota hai.
π LessonLesson
Every option has an expiry date, after which it no longer exists.
- NIFTY: weekly and monthly contracts expire on Tuesday (the monthly contract on the last Tuesday of the month). If that day is a trading holiday, expiry usually moves to the previous trading day.
- Bank Nifty: last Tuesday of the month (monthly contracts only).
NIFTY options are European-style (exercised only at expiry) and cash-settled. At expiry:
- In-the-money options are exercised automatically; the buyer receives the intrinsic value and the seller pays it. STT on exercise is 0.15% of the intrinsic value.
- Out-of-the-money options expire worthless.
Most traders close positions before expiry instead of holding to settlement.
Har option ki expiry date hoti hai, uske baad woh exist nahi karta.
- NIFTY: weekly aur monthly contracts Tuesday ko expire hote hain (monthly contract mahine ke aakhri Tuesday ko). Us din trading holiday ho to expiry aam taur par pichhle trading day par chali jaati hai.
- Bank Nifty: last Tuesday of the month (monthly contracts only).
NIFTY options European-style (sirf expiry par exercise) aur cash-settled hain. Expiry par:
- In-the-money options apne aap exercise hote hain; buyer ko intrinsic value milti hai, seller chukata hai. Exercise par STT 0.15% of the intrinsic value hai.
- Out-of-the-money options zero ho jaate hain.
Zyadatar traders settlement tak rakhne ke bajaye expiry se pehle position close kar dete hain.
β οΈ Common mistakesCommon galtiyan
- Forgetting the expiry day and holding an OTM option to zero.Expiry day bhool kar OTM option ko zero tak hold karna.
- Ignoring STT on exercise for ITM options held to expiry.Expiry tak hold kiye ITM options par exercise STT ignore karna.
- Assuming expiry rules never change β check the latest exchange circulars.Ye maan lena ki expiry rules kabhi nahi badalte β latest exchange circular check karo.
β Quick quizQuick quiz
Score 2 out of 3 or more and the lesson is marked complete automatically.3 me se 2 ya zyada score karo, lesson apne aap complete mark ho jayega.
π SummarySummary
- NIFTY expiry: Tuesday (weekly and monthly).NIFTY expiry: Tuesday (weekly aur monthly).
- European-style, cash-settled.European-style, cash-settled.
- ITM: auto-exercised; OTM: worthless.ITM: auto-exercise; OTM: zero.
π Sources & market rules usedSources aur market rules
- BANKNIFTY expiry: last Tuesday of the month (monthly contracts only) β since September 2025. NSE circulars (expiry day revised from 1 September 2025)
- NIFTY expiry day: Tuesday β weekly and monthly NIFTY expiries (monthly = last Tuesday of the month) since September 2025. NSE circulars (expiry day revised from 1 September 2025)
- STT on option exercise: 0.15% of the intrinsic value β STT when an in-the-money option is exercised at expiry, from 1 April 2026. Union Budget 2026-27 / Income Tax Department
- NSE circulars
Last reviewed: 2 November 2026 Β· Version 1.0 Β· Prepared by the SmaartAlgos Academy team.Last reviewed: 2 November 2026 Β· Version 1.0 Β· SmaartAlgos Academy team dwara taiyaar.
Education only. SmaartAlgos is not a SEBI-registered investment adviser or research analyst. Nothing in this lesson is a recommendation to buy or sell any security. Options trading involves substantial risk of loss. Examples are hypothetical or simulated; market rules are shown with their effective dates β always confirm the latest official circulars.
Sirf education. SmaartAlgos SEBI-registered investment adviser ya research analyst nahi hai. Is lesson me kuch bhi kisi security ko buy ya sell karne ki salah nahi hai. Options trading me bada loss ho sakta hai. Examples hypothetical ya simulated hain; market rules effective date ke saath diye gaye hain β hamesha latest official circular confirm karo.