once the special dividend is paid, this can't go below $2.37 RIGHT??
I just bought 35,000 shares at $3.37. After the special dividend, my losses are below $2.37 plus the taxes I have to now pay on the dividend.
THERE IS NO WAY IT CAN GO BELOW $2.37, RIGHT??
Even if I can sell my 35,000 shares (after I get my $1 special dividend) above say $2.75, I make a quick profit. RIGHT?
I think of it more like what happens when a stock splits. On the ex-div date, the price of stock gets reduced by $1 and trades from there. So it can go up or down. same as a stock split, they adjust the price.
Same thing happens to your puts if you bought protection like Dec 22 3.5 puts. They will adjust to being Dec 22 2.5 puts on the ex-div date also.
That's why it seems to behave more like a stock split to me.