Automatic Exercise

What Does Automatic Exercise Mean?
Automatic exercise refers to a procedure whereby the Option Clearing Corporation, in order to protect the holder of the option, exercises an “in-the-money” option.

For those who do not keep themselves updated with the third Friday each month, can consider it as insurance policy.

Related posts:

1. What Does Adjusted Exercise Price Mean?
2. What is Lapse?
3. Aggregate Exercise Price
4. Automated Clearing House (ACH)
5. Allocation Notice