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Fate of Bear Stearns Options

Posted: Thu Mar 27, 2008 2:58 am
by geekygamma
Assuming the JPM purchase of Bear goes through at some price, what happens to listed options on Bear? Do they just get cash settled if in-the-money? There's a lot of tempting premium built in to some. Thanks

Fate of Bear Stearns Options

Posted: Thu Mar 27, 2008 3:15 am
by Chuck
More than likely, you will be responsible for delivering JPM shares to the counterparty.  You mentioned premium so I assume you're taking a short position.