With the COVID-19 pandemic still spreading in the United States, major theater chains have remained closed for four months and counting. Hollywood studios are continuously pushing back their slate of wide releases due to the uncertainty, or sending their movies straight to VOD and streaming. Rather than just wait and wait for movies to eventually return to theaters, you will now be able to trade on when you think movies will return to theaters (or hit VOD/Streaming). Introducing new Release Date Call and Put options on HSX.
A Release Date Call option speculates that the related MovieStock will have an earlier U.S. release date (Theatrical or VOD/S) than the strike date. For Example: The New Mutants Sep 1 Call [NMUTN.RC] has a strike date of September 1. It will delist at zero if the movie opens on or after September 1st. If the film opens earlier than September 1st, it will cash out at a price determined by the number of days before the strike date. If the film opens on August 28th, then the Call will cash out at H$4.00.
A Release Date Put option speculates that the related MovieStock will have a later U.S. release date (Theatrical or VOD/S) than the strike date. For Example: The New Mutants Sep 1 Put [NMUTN.RP] has a strike date of September 1st. It will delist at zero if the movie opens on or before September 1st. If the film opens later than September 1st, it will cash out at a price determined by the number of days after the strike date. If the film opens on September 4th, then the Put will cash out at H$3.00.
Release Date Call and Put options will halt and cash out during opening weekend. The maximum payout for the Release Date option will be capped at H$60, even if the film is delayed by more than 60 days past the strike date. The options can be delisted and then relisted again with a new strike date.
The first Release Date Call and Put options IPO this week beginning with Unhinged on Monday, The New Mutants on Tuesday and Tenet on Wednesday. Happy trading!