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  • Are Dropping Stock Prices Causing a Decline in Options Volume? [View article]
    Agree wholeheartedly. Further, with the price of options hitting 25 to 30 percent, it just hasn't been worth it.

    But the issue of dropping prices does raise another question: What do the Exchanges do if too many equities drop below $1.00 and there are no available stocks abive $1.00? As I see it they have four choices:

    1) Drop the $1.00 limit to 25 cents and give them 6 months to bring their stock price above the new limit.
    2) Delist the stock and replace it with a pinksheet or OTC stock.
    3) Reduce the size of the index. For example, the S&P500 would become the S&P50! and the Russell 4000 would become the Russell 400! Kind of like a reverse split.

    But my favorite is :

    4) Allow negative numbers.

    jegan ;-)
    Nov 21 14:07 pm |Rating: 0 0
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