Monthly Options
Monthly options are the standard contracts, expiring the third Friday of each month. Learn why they are the default choice for most traders and beginners.
Monthly options are the standard, traditional options contracts. They expire on the third Friday of each month, and they have been the backbone of the options market for decades. When people talk about options without specifying, they usually mean monthlies.
They hit a sweet spot between the fast burn of weeklies and the long wait of quarterlies, which is exactly why they are the default for most traders. Let me show you.
The Balanced Middle
If a weekly option is a match and a quarterly option is a slow-burning log, a monthly option is a steady candle. It gives you a few weeks of runway: enough time for a stock to actually move your way, without the long, expensive wait of longer-dated contracts.
That balance is the whole appeal. You get a reasonable window to be right, decay that is meaningful but not vicious, and the deepest, most liquid market in options. Most strikes and expirations you see quoted are monthlies, so the bid-ask spreads are usually tight and the volume is healthy.
Why They Are the Default
Monthlies are the recommended starting point for a beginner, for three practical reasons.
Enough time to be right. A few weeks gives the stock room to move your way. You are not forced to nail both direction and timing in 48 hours, the way a weekly demands.
Gentler decay. Theta still works against a buyer, but it bleeds more slowly than in a weekly, so a flat day or two does not gut your position.
The best liquidity. Because monthlies are the most heavily traded, they usually have the tightest spreads and easiest fills, which quietly saves you money on every trade.
For selling strategies like the covered call and cash-secured put, monthlies are also a natural fit: enough premium to be worthwhile, and a comfortable cadence to manage the position.
When to Choose Something Else
Monthlies are the sensible default, but not the only choice.
Reach for a weekly when you have a very short-term, high-conviction view and understand the fast decay you are taking on. Reach for a quarterly or longer (like LEAPS) when you want a longer-term position with slow decay and time to be patient. But when in doubt, especially early on, the monthly option is the balanced, liquid, forgiving choice that lets you learn without the extremes working against you.
- Monthly options expire the third Friday of each month.
- They balance enough time to be right with manageable decay.
- They have the deepest liquidity, so spreads are tight and fills are easy.
- They are the sensible default for most traders and beginners.
Pop Quiz
Three quick questions to see what stuck. Pick an answer and the explanation shows up right away.
When do standard monthly options expire?
Monthlies expire on the third Friday of the month, the traditional standard expiration.
Why are monthlies a good default for beginners?
They balance a reasonable time window, manageable theta, and deep liquidity, the friendliest mix to learn with.
Compared to a weekly, a monthly option has what?
A monthly gives weeks instead of days, so the stock has more room to move and decay is less brutal.
Bottom Line
Monthly options are the balanced, standard choice: third-Friday expirations that give the stock enough time to move, decay gently enough to be forgiving, and trade in the deepest, most liquid market. That is why they are the default for most traders.
Save weeklies for short-fuse conviction and quarterlies for patient, long-term positions. When you are unsure, the monthly option is almost always the right place to be.
Keep going: the faster cousin is weekly options, and the longer one is quarterly options.