Information Notice 11/17/25
Executive Summary
FINRA Information Notice 11/17/25 reminds member firms of a modified exercise cut-off time for standardized equity options expiring on November 28, 2025, due to national options exchanges closing early at 1:00 p.m. ET on the Friday after Thanksgiving. This adjustment shifts the deadline for option holders' final exercise decisions from 5:30 p.m. ET to 2:30 p.m. ET under FINRA Rule 2360(b)(23)(A)(viii). It matters for compliance as firms must enforce this deadline to avoid regulatory violations, protect client positions, and manage operational risks during a holiday-shortened trading day. #
What Changed
- - National options exchanges will close at 1:00 p.m. ET on November 28, 2025, triggering a modified exercise cut-off under FINRA Rule 2360(b)(23)(A)(viii): deadline is 1 hour 30 minutes after close (i.e., 2:30 p.m. ET), overriding the standard 5:30 p
- Firms may set earlier internal deadlines for accepting exercise instructions but cannot accept any after 2:30 p.m. ET per FINRA Rule 2360(b)(23)(A)(vi).
- Reiterates standard procedures: in-the-money options auto-exercise under OCC Rule 805 (Exercise-by-Exception) unless a Contrary Exercise Advice is submitted (to override auto-exercise or exercise out-of-the-money options); these can be canceled via A
Suggested Considerations
- Update client communications: Notify option holders of the 2:30 p.m. ET deadline well in advance (e.g., via alerts, trade confirmations).
- Configure systems and procedures: Ensure trading platforms reject post-2:30 p.m. ET instructions; test auto-exercise and Contrary Exercise Advice processes.
- Train staff: Educate operations/trading personnel on Rule 2360(b)(23), OCC Rule 805, and holiday-specific cut-off; document training.
- Monitor and record: Log all exercise instructions, auto-exercises, and any Advice Cancels; retain for surveillance.
- Optional: Establish firm-internal earlier cut-offs (e.g., 2:00 p.m. ET) but enforce no later than 2:30 p.m. ET.
- Contact FINRA contacts (James Turnbull or Matthew Vitek) for clarification.
Key Dates
Compliance Impact
Urgency: low (post-event as of January 2026). This is a one-time reminder for a past holiday adjustment, with low risk of enforcement absent systemic failures. It matters operationally to prevent erroneous exercises, client disputes, or capital charges from uncollected exercise costs, but non-compliance could trigger FINRA surveillance reviews under Rule 2360. Firms should audit 2025 records now f
Who is Affected
References
AI-generated analysis. May contain errors or omissions — verify with the original FINRA source before acting. Full disclaimer.
Summary
Information Notice 11/17/25