I saw a WSJ article today suggesting that TSLA plans to do a 3-1 stock split. When a stock split goes through, what happens to the stock's options/derivatives. Do they adjust to the new stock price or do they stay the same?
Another question I have is whether or not it is a good idea to short a stock that is planning on splitting. From what I recall, the purpose of a stock split is to make the stock price more appealing to a wider audience. When more and more people buy the stock, the stock price will normally increase. Is it a solid conclusion to suggest that shorting a stock during a stock split is a bad idea/investment?
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