0DTE options expire the same day they are bought, which makes them cheap in absolute terms and extremely sensitive to intraday moves. They have exploded in popularity as traders use them to express same-day views on the S&P 500.
The math is brutal for buyers: theta, the daily time decay, is at its steepest in the final hours, so most 0DTE contracts expire worthless. The few winners can pay big, which is exactly why the product is so addictive and so dangerous.
If you trade them, treat them as a defined-risk speculation, size them small, and never let a losing day compound into revenge trading.
Key takeaways
- 0DTE options expire the same day they are bought
- Time decay makes most contracts expire worthless
- Treat them as defined-risk speculation only
