What does option exercise mean?

Call and put options contracts give the owner the right to buy or sell a stock at a certain price by a certain date. When the holder of a call or put option has an option that is "in-the-money" (i.e. the strike of a call is below the current stock price, or the strike of a put is above the current stock price) and decides to buy or sell the stock, that is known as "exercising" an option.

etoro’s policy is to close out in or near-the-money positions beginning at 3:30 pm ET on the expiration date. Although we will take action to sell such options, we cannot guarantee that the option will be sold, and therefore cannot guarantee the option will not be assigned. Learn more here.