Sandisk's 8-for-1 Stock Split: What Happens to Your Open Options Positions

A stock trading above $1,300 a share can make one option contract look like a car payment. On Oct. 29, 2026, Sandisk (SNDK) said it will split its stock 8-for-1, and options traders immediately had a fair question: what happens to the contracts they already hold?

The split in brief

Sandisk announced the split with its fiscal first-quarter 2027 results. According to the company's filing, the key dates are:

• Record date: close of business Nov. 9, 2026.
• Distribution: seven additional shares for each share held, issued after the market close on Thursday, Nov. 19.
• First split-adjusted trading: the open on Friday, Nov. 20, under the same ticker.

Sandisk closed at $1,330.05 on Oct. 29. A forward split (the opposite of a reverse split) cuts each share into more, cheaper shares. It does not add money to the company.

What usually happens to listed options

Listed options, meaning those traded on public exchanges, are guaranteed by the Options Clearing Corporation (OCC), which publishes the rules for adjusting contracts after corporate actions such as splits. For a split that issues a whole number of extra shares, the OCC's by-laws say each outstanding contract is increased by the same number of additional contracts. The strike price (the fixed price at which the option can be exercised) is reduced proportionately, and the unit of trading stays the same.

Applied to an 8-for-1 split, that works out to:

• Each existing contract becomes eight contracts.
• The strike price is divided by eight.
• Each contract still covers 100 shares.

Past splits were adjusted this way. For example, exchange notices reproducing OCC memos show that Nvidia's 10-for-1 split in June 2024 and Chipotle's 50-for-1 split that same month divided strikes by 10 and 50 respectively. Past adjustments do not guarantee identical treatment here.

One caution: the OCC decides adjustments case by case and can make exceptions. As of Oct. 30, we had not found an OCC memo specific to Sandisk, so the expectation above is based on the rule text and precedent, not a published Sandisk notice. The memo, once issued, is the authority on the effective date and the adjusted strikes.

A hypothetical example

The numbers below are made up to show the arithmetic. They are not real Sandisk prices.

Suppose a trader holds 1 call contract (a right to buy shares at the strike price) with a $1,600 strike, bought for a $100 premium per share. The premium is the price paid for the option.

In this example, the total strike value is also unchanged at the moment of adjustment: 100 shares at $1,600 is $160,000, and 800 shares at $200 is also $160,000. The position is the same size economically; it is just sliced into smaller pieces. Short positions (where the trader sold the option) adjust the same way. An obligation to deliver shares therefore scales up in share count, while the strike falls in proportion.

Why option prices look different afterward

A few practical effects are worth understanding, none of which change a position's underlying value:

• Per-contract prices drop to roughly one-eighth. An option quoted at $10,000 per contract before the split would be quoted near $1,250 per contract afterward, but you would hold eight of them.
• Commissions and fees can change. Brokers that charge per contract may charge more on eight contracts than on one. Check your broker's fee schedule.
• Bid-ask spreads look different in dollars. The bid-ask spread is the gap between the price buyers offer and the price sellers ask. A tighter dollar spread on a cheaper contract does not necessarily mean a tighter spread relative to the price.
• Resting orders may be canceled. In past splits, exchanges canceled open good-til-canceled orders (orders that stay active until filled or canceled) in affected series before the adjustment, so orders may need to be re-entered.

Stock split taxes

For U.S. taxpayers holding shares, the IRS says a stock split is not a taxable event. Total cost basis (what you paid for the shares) generally stays the same but is spread across more shares, so the basis per share falls. The IRS example: 100 shares with a $1,500 basis becomes 200 shares with a basis of $7.50 per share after a 2-for-1 split. Brokers commonly track this; a broker or tax professional can confirm the details for a specific account.

Common misconceptions

• A split does not make a company more valuable. The same business is divided into more shares.
• Options do not become "cheaper" in any meaningful sense. Each contract costs less, but you hold more of them.
• A split does not remove option risk. Buying options can still lose the entire premium, and selling options can still produce losses larger than the premium collected. Short positions carry obligations that are scaled up, not erased, by the adjustment.
• Nothing happens by magic on announcement day. The adjustment takes effect at the OCC's stated effective date, not when the split is announced.

The takeaway

For existing option holders, a whole-number forward split is expected to be largely mechanical: more contracts and lower strikes, with the same economic size at the moment of adjustment. The position keeps its full market risk afterward, including the possible loss of the entire premium for buyers and losses larger than the premium collected for sellers. The details that matter most, including the effective date and any unusual series, come from the OCC memo for the specific stock, so that is the document to read once it is published.

This article is educational commentary on public market events, not personalized investment, trading, or tax advice.