Sold some CWEB July puts before the reverse split. However, after the split the position strike was not updated. Instead it was renamed CWEB1 basket derivative with the same strike and I am restricted to close only. Probably a stupid question but could somebody explain the situation. Was there something beyond the reverse split?
Whenever a split occurs it always messes up the option contracts. The system can't anticipate the split & you end up with contracts that are no longer in the market. You can try closing them but if it doesn't work then you need to call your broker to manually rid of them from here.
Thanks, but I've lived through dozens of splits, reverse splits, spin-offs etc. and that was never the case. Every time the strike price was adjusted accordingly; even on non-US exchanges. Closing the position is possible. Still, it was a trading strategy and I intended to roll the puts. Furthermore, with this "basket" thing I am not sure what will happen if I am assigned early.
its a reverse split and so its become a non-standard contract size. No one wants to trade them, hence closing only.