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Post by liane on Jan 19, 2018 8:33:08 GMT -5
Today is a huge op ex for all the 2018 leaps issued over the past 2+ years.
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Post by hopetoretire on Jan 19, 2018 8:52:46 GMT -5
Excuse me if this has been discussed and answered, but today it really matters. Am I correct that options purchased pre-reverse split ($1.00) will today only exercise if the price closes at or above $5.01? Otherwise worthless.... Thanks.
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Post by boca1girl on Jan 19, 2018 8:57:06 GMT -5
Yes. Lots of options expiring worthless today. $5.01 is a long ways away unless some other great news will be released this morning.
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Post by mnholdem on Jan 19, 2018 9:25:36 GMT -5
Excuse me if this has been discussed and answered, but today it really matters. Am I correct that options purchased pre-reverse split ($1.00) will today only exercise if the price closes at or above $5.01? Otherwise worthless.... Thanks. It depends on your brokerage. Mine will automatically exercise any options that are "in the money" but you need to pay attention. For example, if I had $0.50 strike pre-split options they'd be the equivalent of $2.50/share. I cannot say this for all brokerages, but the way my manager explained the closing of reverse-split options is that they'll exercise the options at the strike price but then only add 1/5 of the number of shares to my account.
I always receive an email from my brokerage the day before options expire reminding you that "in the money" options may be automatically exercised and to contact your account rep to request that the options not be exercised. I did.
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Post by jred on Jan 19, 2018 10:13:41 GMT -5
Unfortunately I can confirm from my own portfolio there are a bunch of options expiring worthless today  It is industry standard for all "in the money" options to be exercised, but definitely worth confirming. The shorthand conversion for options pre-reverse split is to multiply original strike by 5 and divide shares per contract by 5 (from 100 to 20). Example: Pre-reverse split position : 25 option contracts with .50 strike expiring 1/19/18 (today) - each option contract represented 100 shares of stock - in order to exercise you would've had to put up an additional $1,250 - ( 25 contracts * 100 shares per contract * $.50 strike) - after exercise you'd have 2,500 shares (pre-reverse split) Now post split: 25 option contracts with 2.50 strike expiring 1/19/18 (today) - each option contract represents 20 shares of stock - in order to exercise you would have to put up same $1,250 - ( 25 contracts * 20 shares per contract * $2.50 strike) - after exercise you'll have 500 shares The Options Clearing Corp sets these terms so they are consistent no matter your broker. In the end you are putting up same amount of $ to exercise and getting equivalent shares ( 2,500 shares pre-reverse split = 500 current shares ). There are enough expiring 2.50 contracts today that I expect the market is going to keep the stock price close to 2.50 with the option market makers making a late push to get it under 2.50 if it's still close. |
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Post by sportsrancho on Jan 19, 2018 10:14:11 GMT -5
I got a email from my brokerage too, which made me think there was hope, nope. Buried 6 feet under...or six bucks under. RIP
No more crying over split/shares.... moving forward!
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Post by cjc04 on Jan 19, 2018 11:19:21 GMT -5
Yea, I was hopeful that the Deerfield debt deal date of the 15th would peg the sp at $3.25, of course accompanied by magical news which was the reason for the deal and date in the first place, bringing the sp even higher by today....SO,, in addition to my worthless options from the past 18 months, I also have plenty of $3.00 expiring today, worthless...
Clearly a higher power overruled and $2.50 was the peg.
Only question now is, with all the PUTS also expiring today, what happens now? Was the sp being held up to $2.50 or being capped at $2.50.... script #s aren’t helping.
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Post by babaoriley on Jan 19, 2018 12:13:40 GMT -5
Can't wait to see more MNKD shares in my account by the end of the weekend, as my long time puts come to roost!
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Post by dreamboatcruise on Jan 19, 2018 13:56:39 GMT -5
Yea, I was hopeful that the Deerfield debt deal date of the 15th would peg the sp at $3.25, of course accompanied by magical news which was the reason for the deal and date in the first place, bringing the sp even higher by today....SO,, in addition to my worthless options from the past 18 months, I also have plenty of $3.00 expiring today, worthless... Clearly a higher power overruled and $2.50 was the peg. Only question now is, with all the PUTS also expiring today, what happens now? Was the sp being held up to $2.50 or being capped at $2.50.... script #s aren’t helping. Best not to imagine there is something to read between the lines. Next real event we know is coming is announcement of earnings. It would appear that it will include admission that guidance was missed. Is that baked into share price or will there be a negative reaction? MNKD could give strong forward guidance and project break-even as they've said they would, but will that be taken seriously if they've just announced a guidance miss. Scripts will continue to grow slowly, but that I'm sure is baked into price. |
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Post by traderdennis on Jan 19, 2018 16:11:14 GMT -5
$2.49 closing price, what a surprise, calls expire worthless, the $2.50 put are in play.
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Post by dreamboatcruise on Jan 19, 2018 16:12:37 GMT -5
Over the years I've traded a fair number of options but haven't really paid much attention to the dynamics of share price action right before expiration. With large caps I doubt the options tail wags the dog, but with MNKD I am coming to believe the share price may be driven by the options.
Is there a way of predicting whether the price will close right above or below a particular strike... e.g. if there are more open calls is it likely to end just below the strike and if more open puts it will end just above?
Just had a bunch of $0.5 pre-split options expire 2 pennies short of in the money.
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Post by xanet on Jan 19, 2018 16:16:59 GMT -5
Over the years I've traded a fair number of options but haven't really paid much attention to the dynamics of share price action right before expiration. With large caps I doubt the options tail wags the dog, but with MNKD I am coming to believe the share price may be driven by the options. Is there a way of predicting whether the price will close right above or below a particular strike... e.g. if there are more open calls is it likely to end just below the strike and if more open puts it will end just above? Just had a bunch of $0.5 pre-split options expire 2 pennies short of in the money. shows the option distribution, so maybe one could extrapolate from that? |
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Post by casualinvestor on Jan 19, 2018 16:17:48 GMT -5
With numbers there's always the chance of coincidence, but the fact that we closed at $2.49 and the 3400 options (calls minus puts) that expired because of it suggests that someone might have been putting pressure to keep us under the mark. Not that we're down at $2.50 just because of options, but I'd bet some last minute extra pressure was put on.
Complete silence from Mannkind on a week where we'd think something would be said about the debt to DF is also odd, and suggest they're staying quiet on purpose. Working with the big boys may be the price of another good raise. That's ok. Or maybe my tin-foil hat is screwed on too tight
I'm hoping that some downward pressure is relieved come monday
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Post by dreamboatcruise on Jan 19, 2018 16:28:39 GMT -5
Over the years I've traded a fair number of options but haven't really paid much attention to the dynamics of share price action right before expiration. With large caps I doubt the options tail wags the dog, but with MNKD I am coming to believe the share price may be driven by the options. Is there a way of predicting whether the price will close right above or below a particular strike... e.g. if there are more open calls is it likely to end just below the strike and if more open puts it will end just above? Just had a bunch of $0.5 pre-split options expire 2 pennies short of in the money. shows the option distribution, so maybe one could extrapolate from that? According to that we should have closed above $2.50. But I guess an underlying assumption, which is likely flawed, is that significantly all of the writers of the options (call and put) are the market makers that then steer the underlying stock price. With MNKD there have been some masochist retail investors like me and a few others I know here that have over the years written puts. I guess there is no perfect way of knowing what is in the financial interest of those pushing the share price around. |
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Post by boca1girl on Jan 19, 2018 18:21:52 GMT -5
Over the years I've traded a fair number of options but haven't really paid much attention to the dynamics of share price action right before expiration. With large caps I doubt the options tail wags the dog, but with MNKD I am coming to believe the share price may be driven by the options.Is there a way of predicting whether the price will close right above or below a particular strike... e.g. if there are more open calls is it likely to end just below the strike and if more open puts it will end just above? Just had a bunch of $0.5 pre-split options expire 2 pennies short of in the money. Watch how AAPL trades on Fridays. They have weekly and monthly options. It’s uncanny, especially with monthly options, how the stock will gravitate towards a strike price. But I imagine that it’s much easier to steer the stock price of a small cap. |
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