Can I hold onto derivatives contracts indefinitely?
No, you cannot hold derivatives contracts indefinitely. All derivative instruments—whether futures or options—are time-bound and expire on pre-defined dates. These expiry dates vary based on the asset class and contract specifications.
Derivatives are always time-sensitive
Every derivative contract comes with a fixed validity. Once the expiry date is reached, the contract ceases to exist and is either settled or expires worthless (in case of out-of-the-money options).
Expiry patterns by product type:
Equity Derivatives:
- Include futures and options on stocks and indices (like NIFTY or BANKNIFTY).
- Typically have both weekly and monthly expiry cycles.
- Monthly expiry is usually the last Thursday of each month.
- Weekly expiry applies mainly to index options and may occur mid-week (e.g., every Thursday for BANKNIFTY).
Currency Derivatives:
- Futures and options on currency pairs like USDINR, EURINR.
- Expiry can be weekly or monthly, based on the instrument.
- Weekly expiry dates vary—it's important to track the calendar for each currency.
Commodity Derivatives:
- Contracts on gold, crude oil, silver, etc.
- Have varying expiry cycles defined by the exchange based on the commodity type.
If the scheduled expiry falls on a holiday, the contract will expire on the previous working day.
What If...
| Scenario | Explanation |
|---|
| I forget the expiry date | The contract will auto-expire and settle as per exchange rules. You may face losses or delivery obligations. |
| I want to maintain my position | You can roll over by closing the current contract and opening a new one in the next expiry cycle. |
| I’m trading options that expire weekly | Weekly expiry will vary depending on the segment. Plan your trades accordingly. |
Regularly monitor your open F&O positions on FYERS and set reminders for upcoming expiries. Mismanaging expiry can lead to margin shortfalls or unwanted settlements.
Last updated: 28 Jun 2025
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