If an underlying stock splits, are the options just adjusted accordingly (i.e. quantity I own is multiplied, and strike price is divided)?
For example, AAPL will have a 7 for 1 split soon.
If I have 3 contracts of a $660 call option, will those become 21 contracts with a $94.2857 strike price?
That seems to make sense mathematically, but will all the strike prices really be at such uneven values? It's hard to imagine that the option chain will have strike prices like this - there will be so many of them and at such odd prices. Will the option prices look like: ..., $91.43, $92.14, $92.86, $93.57, $94.29, $95, $95.71, $96.43, $97.14, etc.?
Finally, will new options with round strike prices be issued, adding even more to the above list?