Nice find. I saw something similar (though less extreme) shortly after the bankruptcy, but also couldn't trade it. The thought has crossed my mind before of buying a bunch of fully hedged positions prior to events like these...
yes - i have done this. The negative part is that your margin requirements go up after an option adjustment (no portfolio margin etc). Typically at IB they will margin your account 1:1 with respect to the notional value of each contract. Can be expensive but virtually no competition after the adjustment (as the example above illustrates). There are many arbs available - you just have to do the work to find them...... good luck
Good info, thanks. I have some other arb strategies I pursue, but monitoring stuff like this hasn't made it up the priorities list. Could be good for an IRA that has limited margin anyway.