Options Expiry on WebNotes

How the F&O expiry calendar works

Sun, 21 Jun 2026 00:00:00 +0000

The F&O expiry calendar in India runs on a fixed weekday rule set by the Securities and Exchange Board of India rather than on a list you memorise. Every derivative on the National Stock Exchange expires on a Tuesday and every derivative on the Bombay Stock Exchange expires on a Thursday, a split that took effect on 1 September 2025 under the SEBI circular dated 26 May 2025. Learn the rule and you can place any contract on a calendar without looking up a date.

Max pain theory

Sun, 21 Jun 2026 00:00:00 +0000

Max pain theory holds that the price of an underlying tends to gravitate, at options expiry, toward the strike at which the total payout to all option buyers, calls and puts together, is the smallest. That strike is the max-pain strike. Stated from the other side, it is the price at which option writers, mostly dealers and market makers, retain the maximum premium, because the largest number of contracts across both calls and puts expire worthless there. The level is computed from the open interest reported on the National Stock Exchange option chain.

What happens to unsquared options at expiry

Sun, 21 Jun 2026 00:00:00 +0000

When an option is left open at expiry, unsquared options are resolved automatically by the exchange according to their moneyness and their underlying. An out-of-the-money option lapses worthless; an in-the-money index option is auto-exercised and cash-settled against the index close; an in-the-money single-stock option is auto-exercised into compulsory physical delivery of the underlying shares at the strike. The framework is set by the Securities and Exchange Board of India and the clearing corporations, and on Zerodha it plays out through Kite and the back-office settlement process.