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Technology Stocks : Cisco Systems, Inc. (CSCO) -- Ignore unavailable to you. Want to Upgrade?

To: J. P. who wrote (15854)	8/7/1998 12:07:00 PM
From: William F. Wager, Jr.	Respond to of 77400

The pay date is 9/15. It will trade at the post-split price on 9/16, i.e., approximately two-thirds the close price on 9/15.

To: J. P. who wrote (15854)	8/7/1998 7:11:00 PM
From: Gerald Walls	Read Replies (1) \| Respond to of 77400

2) Will the options split 3:2, or will the options now be worth 1.5 times their face price (150 underlying shares per contract)? Here's the way I understand it. I've never been long or short an option when a stock split so this isn't from direct experience. In the case of an even split (X:1) you will now have X split options for each pre-split option and the strike is multiplied by 1/X. In the case of odd splits (X:N where N != 1) usually the option will be modified to represent X/N * 100 shares with a strike price multiplied by N/X. In this case the price of one option won't change but it should move about X/N times faster than before because it represents more of the underlying security. Example: an OCT 90 CSCO Call for 100 shares will become an OCT 60 CSCO Call for 150 shares. You'll still have the same number of options and if the option was worth $10 before the split it will still be worth $10 after the split but will move up or down faster. One thing to note is that the first three digits of the option symbol (which represents the underlying) will change in addition to the last digit (which represents the price). This is to distinguish it from the a post-split OCT 60 CSCO Call that will represent 100 shares. This could get really fun if a (say, Internet) stock did a 5:2 and a 3:2 split in the life of one option or leap. Then you have an option for 750 (15/2 * 100) shares at 2/15 of the original strike.