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Sturm, Ruger & Co. Inc. Message Board

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  • mardermj mardermj Nov 24, 2012 9:45 AM Flag

    Special Dividends SHOULD Trigger Option Strike Resets Per OptionUniversity.

    I have read the rules above and it seems as if there is going to be an adjustment for the dividend to all stock strikes because, it appears to be unfair to the call holder to have to exercise his option in order to get the dividend, so the seller of the call bears the entire brunt of the cost.

    If ever there was an idiotic ruling, it has to be this one. Sellers of calls are conservative investors who are hedging, and buyers of calls are gamblers at best. The system seems to come out in favor of the gamblers versus the stock holders, which is the opposite of everything you could possibly devise with respect to the process of hedging bets.

    No wonder the rules are only a year old, I suspect these rules had to wait for the current generation which has to use computers to add subtract multiply and divide, and had to copy all their term papers from the internet to pass English. I don't mind the rule if it made sense.

    It doesn't, but it appears to be the rule.

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