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Author Message  adrian_see Member Username: adrian_see Post Number: 1 Registered: 08-2003 Rating: N/A Votes: 0 Thursday, July 29, 2004 - 08:32 pm:     Hello people Would appreciate if somebody could explain this example. RIO was trading at around 37.10 at 4:00pm today, day of expiry. A 37.00 put expiring today was 0.06 at about 4:00pm and this was not a one off, there were similar trades. Firstly, with no time value left and a negative intrinsic value of 0.10, why would somebody pay 0.06 for the options? Secondly, why are there still so many trades taking place just before expiry, who buys these trades? Thirdly, what time can you trade up to on expiry day? Regards Adrian See Subscribe to our FREE monthly updates Subscribe to regular Incredible Charts updates, with new articles on Trading Strategy, Trading Psychology, Money Management, Tricks of the Trade, New Indicators and the Economy.  mezza8 Member Username: mezza8 Post Number: 44 Registered: 10-2002 Rating: N/A Votes: 0 Sunday, September 16, 2007 - 09:37 pm:     Hi Adrian You can trade untill 4.30pm I think but you will more than likely be dealing with the market maker. Anyone dealing is likely trying to close a written position out and with only the market maker to deal with you will get these prices. In your example with Rio it may gap down on the matchout after hours and then it may gap down again in the morning so you can get into some bother and that may be why some people would wish to close out. The market maker has untill 7pm to decide if he will exercise so if bad news came out in say London after our market has closed and it meant the RIO would likely suffer as a result then he will exercise. If an option finished say 2 cents in the money then he may not exercise but if he knows bad news will see RIO gap down in the morning then you will get exercised and thats a bugger. Cheers Mezza

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