STSM112030 - Derivatives: introduction to options: specified date

The majority of option contracts (see STSM112040) that are issued specify a time period during which the rights under the option can be taken up, after which the option will lapse.

The terms of an option may permit the holder to ‘exercise’ ( see STSM112050) their rights under the option contract and purchase/sell the underlying security, which includes stocks and shares, anytime from the issue date of the option, to the date when the option period expires.