Corporate Actions: Bankruptcies
Managing a PositionBankruptcy can significantly impact both a company’s stock and its associated option contracts. In this video, we explore what happens when a company files for bankruptcy, from delisting and over-the-counter (OTC) trading to how options are affected.
Key topics covered include:
(0:12) Bankruptcy Defined
(0:43) Over-the-Counter (OTC) Market
(1:01) “Closing-only” Options Trading
(1:32) Outcomes of Bankruptcy
(2:00) Adjustment of Option Contracts & the Role of OCC
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