Assume a customer holds 1 ABC Oct 60 Put contract. The market price of ABC is currently $60. On an ex-date with a dividend of $4, the new market price is $56. The contract is still a ABC Oct 60 put correct? The strike and multiplier do not change? So what happens to the premium? Does it just jump up around $4 (there's still time value so it's probably around $4, not exactly)? Why is this? What's the logic? Sorry I'm studying for my series 56 and my book doesn't have a clearer explanation. I know for stock dividends, the contract stays the same. But why does it stay the same for cash dividends?