Lesson 6: Expiration Dates

In this chapter, you will learn how to choose the right expiration date. This part can be very difficult. The further out expiration you choose, the higher the premium will cost per contract. This is because your contract will have a longer time before expiration. You have to figure out how long you plan to hold the contract.

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For day trades and scalps, We recommend choosing the same week expiration in which, I would choose the Friday as the expiration. The reason you don't choose same-day expirations is that if your stock doesn't move in the direction you bought it for, you will need to give yourself a few extra days for the price to reverse and move your way. In addition, choosing weekly expiration dates can help your premium remain stable. If it's a Thursday or Friday we recommend going for next week's expiration. 

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Watch this video by Trading Fraternity on How To Choose The Best Contract Expiration Date:



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