When do long options automatically exercise? (US options and futures)
The Options Clearing Corporation (OCC) will automatically exercise any expiring equity/ETF option(s) that close in the money (ITM) by at least $0.01. For example, if you purchased an XYZ $50 strike call and the stock closes at $50.01 or higher at expiration, the call will automatically exercise, and the account will be long +100 shares purchased at a price of $50 per share. On the other hand, if you purchased an XYZ $50 put and the stock closes at $49.99 or lower at expiration, the put will automatically exercise, and the account will be short -100 shares sold at $50 per share. You can determine if an Equity and ETF options are ITM or OTM based on the last price (close price) at expiration.