What it is
Zero-day-to-expiration (0DTE) options are call or put options contracts that expire at the end of the current trading day. These options allow traders to make highly speculative, short-term bets on a stock's or index's price movement within hours. Because of their immediate expiration, 0DTE options have very little time value, meaning their price is almost entirely driven by the underlying asset's movement, and they can lose all value rapidly if the price doesn't move as expected.
0DTE options have surged in popularity, particularly for trading major indices like the S&P 500, due to their potential for high leverage and quick profits or losses. They can amplify market volatility, especially during significant news events or earnings announcements, as large volumes of these contracts can create gamma squeezes. Retail investors use them for quick directional bets, but their extremely fast decay and high risk make them suitable only for experienced traders.
Why it matters
0DTE options offer extreme leverage for very short-term bets, but their rapid decay means high risk and potential for quick, substantial losses.
Reviewed under editorial standardsUpdated September 26, 2026Not investment advice