Options Trading Tutorial

what happens to a option strike price with a split?

say you have a long call @50 with a 2/1 split would the strike price change to 25?

Public Comments

1. Options usually split the same way the shares do. So, for your 2/1 split, the option strike usually is halved, whereas the shares are doubled.
2. Yes -- you get twice as many options and the strike price is cut in half. With your example, if you had one contract for 100 shares at 50, then after the split you will have two contracts for 100 shares each at a strike price of 25.