Thanks for your reply.
Actually, the SPY 206 Put that expired Friday was well OTM at 4pm, around $25 above the strike. I presume the buyer of the Put could have exercised it at any time prior to expiry (up to 4:15pm), but if the price of SPY had fallen to below the 206 strike by 4:15 when the option expired, would the brokerage automatically execute it, or is the price of the underlying at close (4pm NY time) the determining factor?
What made me wonder is that I noticed Friday that after the 4pm close of SPY regular hours trading, the 206 Put was still being bought and sold and I couldn't help wondering why someone would buy the 206 Put, expiring in 15 minutes, when SPY closed above 206. Perhaps they thought for a few pennies it was worth it since it could have fallen below the 206 strike in after hours trading during those 15 minutes? I can't imagine why else anyone would buy an OTM Put 15 mins before it expired?
Newly
