Enter the expiration date and current date into the calculator to determine the Days To Expiration. This calculator can also evaluate any of the variables given the others are known.
Days To Expiration Formula
The following formula is used to calculate the Days To Expiration (DTE).
DTE = ED - CD
Variables:
- DTE is the Days To Expiration
- ED is the expiration date of the options contract or futures contract (in days)
- CD is the current date (in days)
To calculate the Days To Expiration, subtract the current date from the expiration date of the options contract or futures contract. This will give you the remaining time left until the contract expires. This is a critical factor in options trading as it impacts the price of an option, with options losing value as they get closer to their expiration date, a phenomenon known as time decay. Traders use DTE to make strategic decisions about when to buy or sell options.
What is a Days To Expiration?
Days to Expiration, often abbreviated as DTE, refers to the remaining time left until an options contract or futures contract expires. It is a critical factor in options trading as it impacts the price of an option, with options losing value as they get closer to their expiration date, a phenomenon known as time decay. Traders use DTE to make strategic decisions about when to buy or sell options.
How to Calculate Days To Expiration?
The following steps outline how to calculate the Days To Expiration (DTE).
- First, determine the expiration date of the options contract or futures contract (ED) in days.
- Next, determine the current date (CD) in days.
- Next, gather the formula from above = DTE = ED - CD.
- Finally, calculate the Days To Expiration (DTE).
- After inserting the variables and calculating the result, check your answer with the calculator above.
Example Problem :
Use the following variables as an example problem to test your knowledge.
Expiration date of the options contract or futures contract (ED) = 100
Current date (CD) = 80
