How To Manage Your Trade On Expiration Day

Here's the general formula for knowing what to do on expiration day:

If your trade is super close to your strike price whether you are winning or losing, then close the trade early.
If you are winning, let the trade expire.
If you are losing and can close the trade out for less than $1 (when trading a $1 wide), then close the trade early.
If you are losing and can't close the trade out for less than $1 (when trading a $1 wide), then let the trade expire.

If you are following our recommended Close When Strike Is Broken exit rule, then your goal is to close the trade when the stock breaks your strike price. However, on expiration day, if your trade is close the strike price it is best to sell when the strike price is broken instead of waiting until the market close since it's the expiration day.