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0 DTE Liquidation Criteria
At 3 PM EST, on the last trading day of the contract. If you’re holding a contract that is in the money or super close to going in the money you may be forced to close.
Why? It’s simply a risk thing. If you own an $ABC $5 Call and $ABC is at $6 you’re going to be on the hook for $600 worth of shares at expiration. If the value of those shares is greater than 4X your account size, you may be forced to close.
If you feel as if you can manage this risk you may contact the Trade Desk and, request more time to trade 0 DTE contracts. You only need to contact once per month.
Disclosures: Aries Financial, Inc. is not a broker-dealer or investment advisor. Securities and investments are offered through TradeStation Securities, Inc., Members FINRA and SIPC. Additional information about your broker can be found by clicking here. Aries refers to Aries Financial, Inc mobile App and website, and with securities offered through TradeStation Securities, Inc.