For example - I like a stock and think it will be eventully bought out by a larger player but in the interim I expect the company to issue stock to fund growth - So if I look at a Jan 2008 Call Option at with a Strike Price of $35 -- Does the strike price change if there is share issuance as I expect ? Or am I better off waiting for shares to be issued and then buy an option with a lower strike price ?
2007-05-09 03:44:08 · 3 answers · asked by Anonymous in Business & Finance ➔ Investing
Strike prices would be adjusted for a split or an extraordinary dividend (usually meaning a dividend greater than 10% of the stock price).
Strike prices are not adjusted for share buybacks or new shares being issued by the company.
2007-05-09 19:51:31 · answer #1 · answered by zman492 7 · 0⤊ 0⤋
Strick prices do not change, you call will stay at that strike price.
2007-05-09 04:22:14 · answer #2 · answered by Anonymous · 0⤊ 0⤋
i think the strike price cannot change.
2007-05-09 03:56:41 · answer #3 · answered by Anonymous · 0⤊ 0⤋