Apple special dividend in 2018?

Discussion in 'Stocks' started by ajacobson, Dec 31, 2017.

  1. What are folks thoughts ? Think we'll see one. It would really disrupt the options market.
     
    traderlux likes this.
  2. Robert Morse

    Robert Morse Sponsor

    Why would it do that? Any non-regular dividend are adjusted with the options by the OCC.
     
    FSU likes this.
  3. truetype

    truetype

    Well, it would zero out any puts with strikes of less than the dividend adjustment...
     
  4. good point, even regular dividends can disrupt option trades if you are not careful,
     
  5. Wouldn't those puts already be near worthless?
     
  6. jharmon

    jharmon

    Any special dividends (well anything > 10% of the closing price of a stock) will adjust the contract terms. Nothing to see - move along.
     
  7. truetype

    truetype

    Yes, in the case of a (relatively) low-vol stock like AAPL. But for SHLD... the Jan 2019 $3 put is currently $1.55, with SHLD at $3.62. If (by some miracle) Eddie paid a $3 special dividend, it would erase those puts.
     
  8. Any example like that? chance of shld paying $3 is
    0.0000000000000000000000000000000000000000000000000000000000000000

    bette come up with something better
     
  9. sle

    sle

    DRYS
     
  10. jharmon

    jharmon

    don't trade illiquid crap
     
    #10     Jan 2, 2018