Options Orders: How Do They Work?

Options Orders: How Do They Work?

When placing Options orders, you will only be able to place a buy limit order. You can close a position with a market or limit order:

Opening a Position:

i. Limit Order:

This lets you specify a price at which you want to buy or sell the Option. Your order will only be filled if the market price reaches your desired price.

ii. Market Order:

To mitigate client exposure to market order slippage risk you are not able to place a market buy order on options.

Closing a Position (Exercising or Selling):

i. Limit Order:

Similar to opening a position, you can use a Limit Order to specify the price you want to sell your Option contract at.

ii. Market Order:

This will close your position immediately at the current market price.

Time-In-Force for Options Orders

Options orders typically default to a "Day" time-in-force. This means the order will only be valid for the current trading day and will expire if not filled by the market close. Options exchanges do not offer extended-hours trading.

Trading Hours for Options

Before Expiration: Options can be traded during regular market hours on U.S. trading days.

On the Expiration Day: There are restrictions on opening new positions (buying to open) in the 1 hour leading up to market close. Any unfilled opening orders will be cancelled automatically.

You can still close your existing positions (selling to exercise or close) until the market closes.

Options are complex, high risk products and are not appropriate for all investors. You may lose all of your invested capital.

For more information, please refer to：Characteristics and Risks of Standarized Options