Action in the Google (GOOG, $1131.91, off $2.98) options pit seemed pretty calm this morning. Traders said there was nothing major going on in regards to the special GOOG 100% stock dividend. holders of Class A GOOG shares received one Class C share for every one Class A share they own. The new Class C shares will trade under the symbol GOOG, while the old Class A shares will use the symbol GOOGL. (Class B shareholders also get a 1-1 dividend of a C share, but the B shares are privately held).
Why is this important? As we mentioned last week, holders of a GOOG option position now have a GOOG1 position. Just as a GOOG Class A shareholder received a Class C share, option holders on the original A shares also have an option on the C shares. Sellers on the original A shares also have an obligation on the C shares as well. Talk to your broker or financial advisor if you have any questions about your position.
CBOE RS (Research Circular) # 14 – 154 is the document you should consult if you have any option related questions. If you have any current GOOG option positions on or are contemplating the initiation of any, go to the following link: