Settlement and Your Daily Account Profit and Loss
Your daily account profit and loss is the change in your account balance from one close to the next. On days when options expire, that close can be too high, and the next morning the balance is adjusted down at the first update after the open. It can also be too low and adjusted up. The cause is timing: tradeSteward records your closing balance before your broker settles expired options, and the marks used for that closing balance are not always what the options settle for.
How daily account profit and loss works
While the market is open, tradeSteward records your account balance every minute, and it keeps recording until about 4:15 PM Eastern. The last balance of the day is that day's closing balance. Nothing is recorded overnight.
A day's account profit or loss is its closing balance minus the previous day's closing balance, with deposits and withdrawals set aside so they never count as a gain or a loss. Today's running figure on the Trading Dashboard and the Live Account Monitor is your current balance minus the previous trading day's closing balance, and the Balance History Table lists each day's closing balance and its result.
So each day's result depends on two closing balances, and a closing balance is only as accurate as the values of the positions in it.
Your broker settles later than tradeSteward closes the day
When an option expires, your broker replaces it with its settlement value: cash, shares, or nothing. Brokers do this after the close, usually overnight. tradeSteward's closing balance is recorded before that happens.
An expiration day, step by step
| When | What happens | How expiring options are valued |
|---|---|---|
| 4:00 PM | Expiring options stop trading. | At their marks |
| 4:15 PM | The index's value at 4:15 PM sets the settlement value. | At their marks |
| About 4:15 PM | tradeSteward records the day's closing balance. | At their marks |
| After the close, usually overnight | Your broker settles the expired options: removes them and posts any cash. | At their settlement value |
| Next trading day, just after 9:30 AM | tradeSteward's first update of the day picks up the settled balance. | Settled and gone |
For the rest of the expiration day, the account still holds options that have already stopped trading. They are carried at their marks until the broker settles them. If the marks match the settlement values, the closing balance is right. If they do not, the closing balance is off by the difference, and the next morning's first update corrects it.
Marks and settlement values are not the same
A mark is the price used to value a position before it closes or settles. For tastytrade accounts, tradeSteward builds your balance from cash plus each position at its mark, the midpoint between its bid and ask. Schwab, tradier, and TradeStation report the balance themselves and value positions at their own prices.
A settlement value is what the option is actually worth at expiration: for a call, the settlement price minus the strike; for a put, the strike minus the settlement price; and zero for an option that finished out of the money. A short SPX 7700 put that settles with SPX at 7690 costs 10 points times 100, or $1,000 per contract.
After the close, the two can be far apart. Market makers pull back, spreads widen, and many option quotes stop updating. An option that is about to expire worthless can be left with a 0.00 bid and an ask far above its value, and its midpoint is then far above its value too. The closing balance counts that value; the broker settles the option for nothing.
Example: too high one day, adjusted down the next
Here is a 14-leg SPX position that expired on October 20, 2026. SPX closed at 7712.57, between the position's 7700 put and 7720 call, so every leg finished out of the money and settled for $0.00. These are the marks from each leg's last quote that afternoon.
Marks against settlement values
| Legs | Last quote | Mark | Value at the mark | Settlement value |
|---|---|---|---|---|
| 12 legs: 9 long contracts and 8 short, a net of 1 long | 0.00 bid, 0.05 ask | 0.025 | +$2.50 | $0.00 |
| Long 1 call 7785 | 0.00 bid, 50.00 ask, last updated 4:00:05 PM | 25.00 | +$2,500.00 | $0.00 |
| Short 2 calls 7725 | 0.00 bid, 0.50 ask, last updated 4:00:03 PM | 0.25 | -$50.00 | $0.00 |
| Total | +$2,452.50 | $0.00 |
The 7785 call sat 72 points above the SPX close and settled for nothing, but with no bid its 50.00 ask became a 25.00 mark worth $2,500.00. Here is what that does to two days of account results:
- October 20: the closing balance includes $2,452.50 the expired legs were never going to pay, so the day's profit is $2,452.50 too high.
- October 21: overnight the broker settles the legs for $0.00. The first update after the open shows the balance $2,452.50 lower, and the day starts with that loss.
- Both days together: correct. The overstatement on October 20 and the adjustment on October 21 cancel.
It can run the other way. The two short 7725 calls had a stale 0.50 ask, so they counted as a $50.00 liability that settled for nothing. A short option marked above its settlement value makes the closing balance too low, and the next morning adjusts it up.
AM-settled options and share settlement
Two other kinds of settlement also change your balance after the close:
- AM-settled options, including standard monthly SPX options that expire on the third Friday, stop trading at the close the day before. They settle on a special opening value calculated from the opening prices of the index's stocks on expiration morning. That value does not exist at the prior day's close, so the move from the prior day's mark to settlement comes from the market's move into the open and belongs to expiration morning.
- Stock and ETF options such as SPY and QQQ settle in shares. A long option at least $0.01 in the money is exercised automatically, and a short option in the money is usually assigned. On expiration day the option is worth the amount it is in the money at the stock's 4:00 PM closing price. If its mark differed from that amount, the difference belongs to expiration day, just as it does for a cash-settled option. The shares appear in the account on the next trading day, and what they do after the close belongs to the days that follow. See Equity Assignments.
Index options such as SPX, XSP, NDX, and RUT settle in cash and cannot be assigned early.
Correct the closing balance
When options that expired at the close were carried at marks that differ from what they were worth at the close, you can put the difference back on expiration day by correcting that day's closing balance. This applies to cash-settled and share-settled options alike. Leave the closing balance alone for AM-settled options.
- Open the Balance History Table from the Tracking menu, under Account (/trading/balance/history), with Account P/L selected.
- Find the expiration day and click the pencil next to its balance.
- In Edit End of Day Balance, choose the account that held the expired options.
- Enter that account's settled balance and click Update.
The settled balance is the account's closing balance minus the expired options' value at their marks, plus their value at the close. For a cash-settled index option such as SPX, NDX, or RUT, that is its settlement value, set by the index's value at 4:15 PM. For an option settled in shares, it is the amount it was in the money at the stock's 4:00 PM closing price, or zero. In the example above, the settled balance is the closing balance minus $2,452.50. When the expired options were cash-settled and the only positions in the account, it also equals the balance at the first update after the next open. With shares involved, the next morning's balance also carries the shares' move since the close, so work from the closing price instead.
The correction carries through to the Balance History Table, the Balance and Profits Over Time charts, and the next day's result. The pencil turns red on any day you have edited, and Reset to Original Value in the same window puts back the balance tradeSteward recorded.