What exactly ends?
Expiry marks the end of the right under the specified process. Exercise style determines when the right may be exercised; it is not the same as the location of the trading venue. A prohibition on early exercise does not prohibit every closing transaction, but the ability to close does not guarantee liquidity or a desired price.
Before acting, establish the last trading moment, how settlement value is determined, the exercise date and later transfer dates. Physical and cash settlement have different consequences. A physical option may create an underlying position and payment; a cash-settled option produces the specified monetary result. “Expires tomorrow” does not provide the full sequence.
The premium can be small relative to the future payment
In a teaching model, a call gives the right to buy ten units at a strike of 100 each. The premium is 4 per unit, or 40 per contract. Physical purchase at the strike requires 1,000 monetary units, not another 40. If the final underlying price is 102, total intrinsic value is 20 and the result after the initial premium is −20 before costs. Being above the strike does not mean positive profit.
Do not assume the asset is immediately sold at 102. That would be a separate transaction with its own price, time and costs. Do not assume the intermediary finances the shortfall or must close the resulting position without loss. The documents determine possibility, procedure and responsibility.
Automatic processing is also a condition
Contracts and intermediaries may use different thresholds and procedures when no instruction is given. The OIC warns that treatment of expiring positions is not one universal instruction for every client account. Do not transfer a foreign numerical threshold into a Russian-market rule. Find the value used to determine moneyness, what happens if assets are insufficient and the final time for instructions.
A counterexample is a positive last trade relative to the strike while the specification uses a different settlement value. Exercise cannot be inferred from the screen price. Another is knowing the expiry date but missing an earlier instruction deadline. Draw a timeline for trading, instructions, index determination and settlement.
A verification card and post-exercise obligations
Record option type, side, strike, multiplier, style, settlement, final deadlines and required cash or assets. Check the derivatives introduction, settlement route and security identifiers for context. The purpose is to prevent a small premium from hiding a large possible exercise amount; it is not advice to hold or close the position.
List the assets and obligations created after exercise. If an underlying position appears, its later risk does not disappear at expiry. If cash settlement is required, record its base and due date. The fictional example ends at its stated point and does not model later ownership, so an immediate sale at the old price cannot be called guaranteed.