# Expiry and Settlement

### Expiry Time

* All options on ClickOptions **expire at 08:00 UTC** on their maturity date.
* Available expiries: **Daily, Weekly, Monthly, Quarterly**.
* Once expired, contracts are **automatically settled** and results recorded in *Exercise History*.

### Settlement Price Calculation

The **Settlement Price** is based on the **time-weighted average price (TWAP)** of the proprietary Index Price during the last **30 minutes before expiry (07:30–08:00 UTC)**.

#### Formula:

$$
SettlementPrice = \frac{\sum (IndexPrice\_t \times Weight\_t)}{\sum Weight\_t}
$$

Where:

* IndexPricetIndexPrice\_tIndexPricet​ = Index Price at time *t*
* WeighttWeight\_tWeightt​ = Assigned weight for observation *t*

This ensures the final settlement price is robust against **short-term volatility and price manipulation**.

### ITM vs OTM Outcomes

* **In-the-Money (ITM):**\
  The option has positive intrinsic value at expiry.

  * **Call Option:**

  $$
  IntrinsicValue = \max(IndexPrice\_{settlement} - Strike, ; 0) \times ContractSize
  $$

  * **Put Option:**

  $$
  IntrinsicValue = \max(Strike - IndexPrice\_{settlement}, ; 0) \times ContractSize
  $$
* **Out-of-the-Money (OTM):**\
  The option expires worthless → no payout.

### Exercise Fee

* **Applied only to ITM options** at expiry.
* Exercise rate: **0.25%**
* **Exemption:** If the option was opened and expired on the **same day**, no exercise fee applies.

#### Formula:

$$
\mathrm{ExerciseFee} =
\min!\
(\mathrm{ExercisePL} \times \mathrm{ExerciseRate}, \mathrm{Quantity } \times OptionPrice \times MaxCapRate)
$$

### Example – BTC Call Expiry

* **Strike:** 100,000 USDT
* **Settlement Price:** 105,000 USDT
* **Contract Size:** 0.01 BTC
* **Premium Paid:** 150 USDT

#### Intrinsic Value:

$$
IntrinsicValue = (105{,}000 - 100{,}000) \times 0.01 = 50 ; USDT
$$

#### Profit Calculation:

$$
Profit = IntrinsicValue - Premium - ExerciseFee
$$

If ExerciseFee = 0.13 USDT:

Profit=50−150−0.13=−100.13 USDT