Strike, Days to Expiry and Out of the Money, in Plain Words

Published Oct 26, 2026

Every option contract is defined by a few terms: which stock it is on, whether it is a call or a put, its strike and its expiration date. Two more figures describe where a contract stands right now: its days to expiration and how far out of the money it is. These are the terms an options Monitor in OpScout asks you to set.

Strike

The strike is the price at which the option lets its holder act:

• a call lets its holder buy the shares at the strike;
• a put lets its holder sell the shares at the strike.

For an option seller, the strike is the price at which you may have to sell your shares (a covered call) or buy shares (a cash-secured put).

In and out of the money

Where the stock trades relative to the strike decides whether exercising the option would make sense for its holder today.

An out-of-the-money contract has no value from exercise today; its whole price is what the market pays for the chance that this changes before expiration. The out-of-the-money percentage says how far the strike is from the stock price, as a share of that price. OpScout uses the figure the data source calculates; it does not reconstruct it.

A covered call or cash-secured put with a strike further out of the money usually brings a smaller premium, and leaves the stock more room to move before the strike is reached.

Expiration date and days to expiry

The expiration date is the last day the option can be exercised. Many stocks have options expiring every week or every month, and some much further out.

Days to expiration (DTE) counts the days left. It is the length of the commitment an option seller takes on, and it is the period over which a return is annualized. For its own return calculation, OpScout counts the time to 4:00 p.m. Eastern Time on the expiration date, in fractions of a day.

Fewer days usually means a smaller premium per contract, an earlier decision point, and a larger annualized figure for the same premium.

How a Monitor lets you set them

The strike rule

You can describe the strike in one of two ways:

• Relative: an out-of-the-money distance, either a minimum percentage or a preset range, compared with each contract's out-of-the-money percentage. Ranges run from 1% to 50% for a Covered Call and from 1% to 99% for a Cash-Secured Put. Only contracts that are out of the money for the strategy are considered.
• Absolute: a strike-price condition you enter, compared with each contract's listed strike.

A relative rule moves with the stock: as the price changes, so do the strikes that qualify. An absolute rule stays where you put it.

The expiration rule

You can describe the expiration in one of two ways as well:

• A day range: contracts whose days to expiration fall between your minimum and maximum, inclusive at both ends. As time passes, new expirations move into the range and old ones move out.
• Specific dates: only contracts expiring on exactly the dates you choose.

When you create or edit a Monitor, the app shows the expiration dates available, refreshed once a day.

Two more optional limits

• Implied volatility range: the contract's implied volatility, as the data source reports it.
• Maximum in-the-money probability: applied using the data source's probability that the contract expires out of the money. A maximum of X% in the money is applied as at least 100 − X% out of the money. These probabilities come from the data source's models; they are estimates, not the likelihood of any outcome.

Why a screen can miss contracts

Each screen returns at most 1,000 contracts, ordered by the screening service's own annualized figure, highest first. On a stock with a very large option chain and broad rules, contracts beyond that limit are never seen. Narrower strike and expiration rules keep a screen within it. Result limits.

In short

• The strike is the price at which the option acts; the expiration is when it ends.
• Out of the money means exercising would not make sense for the holder today.
• In an OpScout options Monitor, you set the strike as a distance or a price, and the expiration as a day range or dates.

Covered Call alerts · Cash-Secured Put alerts