Options Education - The Fundamentals
Which months can you buy options for?
Options are always available for the month that contains the next expiration date, the month after that, and then a series of months that are spaced three months apart. When options are first made available on a stock, that stock gets assigned to be on either a January-, February-, or March-cycle... and this designation determines which additional months will be used for options going forward (a company on the February cycle, for example, will always have the options available for the following months: a) the current month of expiration, b) the next month after that, and c) some combination of February, May, August, and November).
In addition the short-term options that trade on this cycle, some stocks also have LEAPS traded on them. LEAPS is an acronym for Long-term Equity AnticiPation Securities, which is just a fancy way to say "longer-term option." The life of these contracts is often measured in years rather than months, and they always expire on the third Friday of January in the year specified by the contract.
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