Company XYZ announced the distribution of cash dividend equaling 900 Agorot per share. Assume the known closing price at the date the company first announced the dividend is 38,000 Agorot.
The underlying asset's multiplier is 100.
Since the dividend amount exceeds 0.4% (900/38,000) of the known closing price at the date of the announcement, TASE will adjust the specifications of the equity option as follows:
Assuming the record date (also known as the Cum Date) price of company XYZ is 40,100 Agorot, TASE will calculate the Ex-Date price (which is the opening price the next trading day after Record Date) as the record date price minus the dividend rate per share.
As a result, the Ex-Dividend price will be 39,200 Agorot (40,100-900).
The strike price will be adjusted as follows:
The NIS 400 strike price on Call (400) will be changed to 391.02 as follows:
The strike prices on all option series for all expiration dates will be adjusted according to this ratio [392/401].
The contract unit will be adjusted upwards, as it will be multiplied by the inverse ratio.
Hence, since the contract unit was 100, the new one will be 102.30 as follows:
Summary Table:
|
Option specification |
Before Adjustment |
After Adjustment |
|---|---|---|
|
Strike Price |
400 |
391.02 |
|
Contract Unit |
100 |
102.3 |
|
Symbol |
XY8U40000C |
XY*U39102C |
|
Name |
XYZ C40000 SEP8 |
*XY C39102 SEP8 |
