Options Orders: How Do They Work?

Order Types for Options Trading

• When placing options orders, you'll have two choices for order types, depending on whether you want to open or close a position:

Opening a Position:

• 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.

Market Order: This order instructs the brokerage to execute your trade immediately at the best available market price.

Closing a Position (Exercising or Selling):

• 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.
• 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 the1 hour leading up to market close. Any unfilled opening orders will be canceled automatically.
• You can still close your existing positions (selling to exercise or close) until the market closes.

Options are complex financial products. As such, you must ensure you have read and understood our Standard Client Agreement, Target Market Determination, Product Disclosure Statement, and Characteristics and Risks of Standardised Options. For more information, please refer to Terms and Conditions