Citigroup Inc?shares struggled on the first day after a 1-for-10?reverse stock split. For details, see [ID:nN09222402] The stock fell 2.45?percent to $44.09. Option traders seem to be on the sidelines as the new?standard 100 per share option contracts are not being listed until Tuesday,?said Patrick Mortimer, director of options trading at Pipeline Trading?Systems.
For owners of the pre-split option contracts, the multiplier was reduced to?10 shares from the standard 100 shares. “It appears professional traders are?waiting for the new listed contracts,” said Trade Alert president Henry?Schwartz. “The old options are there and will trade side-by-side with the new?ones until they expire.”
Citigroup has been a top option volume name. But the bulk of the volume?exploited the fee structure of the options market in which high frequency?traders repeatedly opened and closed positions to capture rebates, said Mark?Longo, Chief Executive of The Options Insider.?Citi traded almost 500,000?option contracts per day, making it the most active single options name by far,?Schwartz said. After the split, late session volume sits at about 75,000?contracts, Trade Alert data shows.