0DTE Options: The Complete Beginner's Guide

Zero days to expiration options, commonly called 0DTE, are options contracts that expire on the same day they are traded. Over the past few years, 0DTE options on SPX have gone from a niche corner of the derivatives market to accounting for nearly half of all SPX options volume. If you are new to trading or curious about what the hype is about, this guide covers the fundamentals.

What Are 0DTE Options?

Every options contract has an expiration date. A 0DTE option is simply one where that expiration date is today. When the CBOE introduced daily SPX expirations (Monday through Friday), it unlocked the ability to trade options that expire the same day, every trading day of the week. These contracts typically start the morning with some time value remaining, and by market close, they expire worthless if out of the money or settle at intrinsic value if in the money.

The appeal is straightforward: because these options expire so quickly, they are significantly cheaper than longer-dated contracts. This means defined-risk strategies can be structured with smaller capital requirements and the results are known by end of day. No overnight risk, no gap risk, no multi-day theta decay to sit through.

Why 0DTE Has Exploded in Popularity

Several factors have driven the 0DTE boom. First, the introduction of daily SPX expirations gave traders five expiration days per week instead of one or two. Second, the defined-risk nature of credit spreads means you always know your maximum loss upfront. Third, the rapid time decay of same-day options works heavily in favor of premium sellers, which is the basis for most 0DTE strategies. Finally, platforms like IntelliTrade have automated the entire process, from strategy selection to exit management, making it accessible to traders who do not want to stare at screens all day.

Basic 0DTE Strategies

Iron Condor

The Iron Condor sells a call spread above the market and a put spread below, collecting premium from both sides. It profits when SPX stays within the range defined by the short strikes. This is the go-to strategy in positive GEX environments where the market is expected to stay range-bound. A typical 0DTE Iron Condor on SPX might have 15-25 point wide wings and target a 30%+ return on risk.

Iron Fly

The Iron Fly (or Iron Butterfly) is similar to the Iron Condor but sells both the call and put at the same strike, usually at the money or at the GEX PIN level. It collects more premium than an Iron Condor but has a narrower profit zone. This strategy works best when you expect the market to pin to a specific level, which is common during positive GEX regimes with a clear GEX PIN nearby.

Directional Spreads

A directional credit spread bets on SPX moving in one direction. A bull put spread (selling a put spread below the market) profits if SPX stays above the short put strike. A bear call spread (selling a call spread above the market) profits if SPX stays below the short call strike. These are used when there is a directional bias, such as during negative GEX when the market is trending.

Risk Management Essentials

0DTE options move fast. A position can go from profitable to max loss in minutes during a sharp market move. Here are the non-negotiable risk rules:

• Always use defined-risk strategies. Never sell naked options on 0DTE. Spreads cap your maximum loss.
• Set a daily loss limit. Decide before the market opens how much you are willing to lose today. Stop trading if you hit it.
• Size positions appropriately. A single 0DTE trade should risk no more than 1-2% of your account. The allure of cheap options can tempt you to oversize.
• Have an exit plan. Know your profit target and loss cut before entering. IntelliTrade uses dynamic trailing stops, breakeven breach detection, and time-based profit harvesting to automate this.
• Check GEX before trading. The GEX regime determines which strategies are appropriate. Trading an Iron Fly in negative GEX is a recipe for a blown-out position.

For a complete breakdown of every 0DTE strategy, including entry criteria, strike selection, and exit rules used by IntelliTrade's automated system, visit our full 0DTE Strategies education page.