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Strategies & Market Trends : OPTION TRADING-30 DAYS OR LESS
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To: JT Naso who wrote (1962)7/12/1997 12:47:00 PM
From: Bill Chase   of 1986
 
JT-

>> I believe this stock is going to do a 3:1 split. What happens
>>to me when I purchase ten 100 share contracts pre-split?

Say the underlying stock closes day before split @ 99
would now be 33

10 contracts of the NOV 95 Calls @ 7 1/8
95 / 3 = 31.666656 @ 7 1/8 / 3 = 2.375

You now will have 30 contracts of the Nov 31 5/8 or 31 11/16 (depending on what decimal gets rounded out to) @ 2 3/8
post-split

-Bill Chase
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