Have you figured out how the post-merger splits work? Seems like the pre-merger value of SPRT (now GREE1) has fallen to ~$5. The strikes were not adjusted but instead reference this GREE1 value. So for example, the Oct $28s are trading ~$23. Strange thing is the deliverable at exercise is 11.5 shares, but if you were to buy 1 Oct $28 put you have to pay $23 x a multiple of 100 shares still?!? Totally confusing. I'm not sure why they didn't just adjust the $28 strike x 0.115 as well and keep the contract multiple at 100 shares.
I’d like to comment about this setup. first of all, me too. I sell deep itm puts on memes.
But I think it needs to be pointed out that often in memes the volatility curve experiences backwardation. The near dated options are far more volatile than the farther dated options.
The implied move for $SPRT in the 18 day cycle (expiring 9/17) is $25…
Whereas the expected move in the 109 day (12/17) cycle is $38.
In these instances it enhances the position to sell the nearer dated puts, rolling them in the near month until the volatility normalizes.
Are you concern about the exchange ratio of the stock, from SPRT to GREE, after the merger closes, (vote date 9/10), and how that will affect the options chain? Does the $10 puts become $117 puts?
Have you figured out how the post-merger splits work? Seems like the pre-merger value of SPRT (now GREE1) has fallen to ~$5. The strikes were not adjusted but instead reference this GREE1 value. So for example, the Oct $28s are trading ~$23. Strange thing is the deliverable at exercise is 11.5 shares, but if you were to buy 1 Oct $28 put you have to pay $23 x a multiple of 100 shares still?!? Totally confusing. I'm not sure why they didn't just adjust the $28 strike x 0.115 as well and keep the contract multiple at 100 shares.
Am I missing something?
I’d like to comment about this setup. first of all, me too. I sell deep itm puts on memes.
But I think it needs to be pointed out that often in memes the volatility curve experiences backwardation. The near dated options are far more volatile than the farther dated options.
The implied move for $SPRT in the 18 day cycle (expiring 9/17) is $25…
Whereas the expected move in the 109 day (12/17) cycle is $38.
In these instances it enhances the position to sell the nearer dated puts, rolling them in the near month until the volatility normalizes.
Hi there,
Are you concern about the exchange ratio of the stock, from SPRT to GREE, after the merger closes, (vote date 9/10), and how that will affect the options chain? Does the $10 puts become $117 puts?
https://www.sec.gov/Archives/edgar/data/1104855/000119312521241850/d166032ddefm14a.htm