Corporate Actions: Forward Splits
Managing a PositionA forward stock split increases the number of outstanding shares while reducing the price per share proportionally - but what does this mean for option holders?
This video breaks down how stock splits affect equity options and details topics such as:
(0:12) Definition of a Forward Stock Splits
(0:24) Whole and Non-integer Ratios Defined
(0:39) Example: 2 for 1 Stock Split
(1:08) The Impact of Forward Stock Splits on options
(1:43) Adjustments Made To/ Not Made to for Whole Integer Ratio Splits
(2:21) Adjustments Made To/ Not Made to for Non-Integer Ratio Splits
(2:46) Where To Find Details of Contract Adjustments
(2:52) Summary: Forward Stock Splits
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