Delivery, Exercise and Corporate Actions

For futures contracts that are settled by actual physical delivery of the underlying commodity (physical delivery futures), customers may not make or receive delivery of the underlying commodity. Certain currency futures are excepted from this rule (see the table below).

To avoid deliveries in expiring futures contracts, customers must roll forward or close out positions prior to a Close-Out Deadline. The standard Close-Out Deadline for holders of long positions is the end of the second (2^nd) business day prior to the exchange specified First Notice Day. For holders of short positions, the standard Close-Out Deadline is the end of trading on the second (2^nd) business day prior to the exchange-specified last trade day. Certain contracts use a different time ahead of the Close-Out deadline as specified in the following table.

It is the customer's responsibility to be aware of the Close-out Deadline. If a customer has not closed out a position in a physical delivery futures contract by the Close-Out Deadline, IB may, without additional prior notification, liquidate the customer's position in the expiring futures contract. Please note that liquidations will not otherwise impact working orders; customers must ensure that open orders to close positions are adjusted for the actual real-time position.

*As Cash and IRA accounts are restricted from holding foreign currencies, the liquidation schedule outlined above for All other contracts will also apply to Cash and IRA accounts for these foreign currency products.

Click here to learn more about Special Labeling and Expiration Date Descriptions for futures contracts.

To exercise an option is to implement the right under which the holder of an option is entitled to buy (Call option) or sell (Put option) the underlying security. Options are exercised through the IB Trader Workstation's Option Exercise window (accessible from the TWS View menu). For detailed instructions on exercising an option using the IB Trader Workstation, refer to the TWS User's Guide.

Option Exercise Requests (whether received through an IB TWS Option Exercise window or by a ticket sent via Account Management/Message Center⁽¹⁾) may be submitted as follows:

Use the TWS Option Exercise window to either: (i) exercise an option prior to expiration, or (ii) deliver "contrary intentions" to the clearinghouse for the options held; e.g., The Options Clearing Corporation (“OCC”) for options traded on U.S. options exchanges. You must also use the TWS Option Exercise window to instruct the clearinghouse to exercise an option contrary to the clearinghouse’s accepted policy on an options Expiration day (e.g., Expiration Friday for US options). If you do not use the TWS Option Exercise window to manually manipulate options, the clearinghouse will handle the exercise automatically in the manner described below:

OCC (USA)

FOR OPTIONS TRADED ON US EXCHANGES AND CLEARED THROUGH OPTIONS CLEARING CORPORATION (OCC):

Stock options expiring in the current month that are $0.01 or more in the money will be automatically exercised by the OCC without the need for any explicit instructions from IB. Index options expiring in the current month that are $.01 or more in the money will be automatically exercised by the OCC without the need for any explicit instructions from IB.

IB must receive "contrary intentions" from you through the TWS Option Exercise window if you want to: Avoid the exercise of a stock option or index option that is in the money by $0.01 or more. Exercise a stock option or index option that is in the money by LESS than $0.01. Exercise a stock option or index option that is out of the money.

CDCC (Canada)

FOR OPTIONS TRADED ON CANADIAN EXCHANGES AND CLEARED THROUGH CANADIAN DERIVATIVES CLEARING CORPORATION (CDCC):

Stock options expiring in the current month that are 0.01 CAD or more in the money will be automatically exercised by the CDCC without the need for any explicit instructions from the customer. All index options expiring in the current month that are in the money by any amount will be automatically exercised by the CDCC without the need for any explicit instructions from the customer.

The CDCC must receive "contrary intentions" through the TWS Option Exercise window if you want to: Exercise a stock option that is in the money by less than 0.01 CAD. Exercise a stock option or index option that is out of the money. Notify CDCC that you do not want to exercise a stock option that is 0.01 CAD or more in the money.

ECC (Germany, Switzerland)

FOR EQUITY OPTIONS TRADED ON EUREX AND CLEARED THROUGH EUREX CLEARING AG (ECC):

Stock options expiring in the current month that are more than 10 basis points in the money will be automatically exercised by the ECC without the need for any explicit instructions from IB. Index options expiring in the current month that are more than 10 basis points in the money will be automatically exercised by the ECC without the need for any explicit instructions from IB.

The ECC must receive "contrary intentions" through the TWS Option Exercise window if you want to: Exercise a stock option that is in the money by 10 basis points OR LESS. Exercise a stock option or index option that is out of the money.

LCH (UK)

FOR EQUITY OPTIONS TRADED ON LIFFE AND CLEARED THROUGH LONDON CLEARING HOUSE (LCH):

Stock options expiring in the current month that are more than 1 pence in the money will be automatically exercised by the LCH without the need for any explicit instructions from IB. Index options expiring in the current month that are more than 1 pence in the money will be automatically exercised by the LCH without the need for any explicit instructions from IB.

The LCH must receive "contrary intentions" through the TWS Option Exercise window if you want to: Exercise a stock option that is in the money by 1 pence OR LESS. Exercise a stock option or index option that is out of the money.

CNET (Belgium, France, Germany, Netherlands)

FOR EQUITY OPTIONS TRADED ON EURONEXT AND CLEARED THROUGH CLEARNET SA (CNET):

Stock options expiring in the current month that are more than 0.01 in the money will be automatically exercised by CNET without the need for any explicit instructions from IB or IB customers. Index options expiring in the current month that are more than 0.01 in the money will be automatically exercised by the CNET without the need for any explicit instructions from IB or IB customers.

All of the tools you need to understand and participate in corporate actions are displayed on a dedicated Corporate Actions tab in Account Management. Simply click the Message Center icon to gain full access to notifications on all upcoming corporate actions that may affect you, based on the positions your hold. This means that regardless of whether you hold a stock, option, bond, or SSF position in ABC company, you will receive notification of upcoming corporate actions on ABC stock. We notify you of impending actions up to three months out, and track 14 different types of corporate actions, including dividends, forward and reverse splits, spinoffs and issuances, mergers, name/symbol changes, and a variety of tenders and offers.

Each notification is displayed on a separate line along with two useful Function icons. Click the "Magnifying Glass" icon to display more detailed information about the corporate action.

Click the "Pencil and Paper" icon to initiate an email to customer service where you can elect to participate in a voluntary corporate action.

To participate in a voluntary corporate action, submit an Inquiry/Problem ticket via Account Management. To do this, go to Account Management, and from the Customer Service menu, select Message Center, then select Corporate Actions.

In the text of the request you must state the issue or description of the security (name and symbol) and the quantity that you wish to tender or exercise (you cannot simply say "all," you must state an exact amount).

Instructions received after 12:00 PM on the day prior to the expiration date of the offer will be handled on a best efforts basis.

For Australian stocks, rights issues and other corporate actions require instructions 7 days prior to the expiration date of the offer. Instructions received after this time will be handled on a best efforts basis.

After IB receives the completed instructions, you will receive confirmation of receipt of your instructions within one business day. If you do not receive confirmation, you must contact the IB Help Desk by clicking here. Submission of more than one ticket for the same voluntary offer may result in the account being over-subscribed to an offer.