Replies to post #1672 on Roku Inc (ROKU)

[DrHarleyboy]

. The "being made whole" calculation is relatively straightforward for options. Each option contract typically controls 100 shares of an underlying security at a predetermined strike price. The new share ownership is generated by taking the split ratio and multiplying by 100 while the new strike price is generated by taking the old strike price and dividing by the split ratio.

For example, if you buy a call option that controls 100 shares of XYZ with a strike price of $75. If XYZ announces a 2:1 stock split, the contract would now control 200 shares with a strike price of $37.50. On the other hand, if the stock split is 3 for 2, the option would control 150 shares with a strike price of $50.


https://www.investopedia.com/ask/answers/what-happens-to-options-when-stock-splits/