Who knows about stock options and stock splits?

[IndyJaws]

If I have 500 options on a stock at $38 per share, and it splits 2-for-1, do I now have 1000 options at $19/share? I know if I have 500 shares (not options) and the stock splits 2-for-1 at say, $100/share, I now have 1000 shares @ $50/share. Do options work the same way?

 

[StageLeft]

I would think that they must! I have 250 options of company stock, currently trading at $.53 I own!!

 

[flot]

Indy -

Yes, that's usually the way it works. When the stock splits, your # of options doubles AND your price gets cut in half.

 

[Arschloch]

<< I would think that they must! I have 250 options of company stock, currently trading at $.53 I own!! >>


Good! Cash in the options and buy yourself a few shares of K-Mart!

 

[squirrelman]

No actually it doesnt always work that way. You have a contract to buy the stock at a certain price. Usually after splits I think the option holder will usually adjust it, since I am assuming you have them from an employeer because I doubt your actually trading options. Anyways what I would do is try asking someone at work who might know, that would be the best way to go about it.