I am currently on the options chapter and wanted to flag that this questions correct answer is incorrect. The time zone was wrong for option trade cutoff time being 4:00pm CT. The answer is actually 3:00pm CT/4:00pm ET. I chose the wrong answer because they all looked incorrect. Can I get clarification on this?
Hi @Broker_Boyd,
Time zones can be tricky! The question is correct as written, as it asks which statement is false. Let’s go through the options:
- Trade cutoff: Listed equity options stop trading at 4:00 p.m. ET = 3:00 p.m. CT, so the statement saying 4:00 p.m. CT is the false one.
- Exercise instructions: OCC deadline is 5:30 p.m. ET = 4:30 p.m. CT (firms may have earlier house cutoffs), so that statement is true.
- Expiration time: Options officially expire at 11:59 p.m. ET = 10:59 p.m. CT, so that’s true.
- Exercise only if ITM: Standard exam rule-of-thumb (and ITM options are auto-exercised unless you say otherwise), so true.
Hope this helps!
Best,
Mataia