Dubai World Crisis Impact on Expiry

With the happening of Dubai World Crisis, which is a pretty big Dubai company having difficulty repaying its debt to its creditors. Causing huge financial impact globally. Yesterday the HSI drop more than 1000 points and it certainly had some impact on my option open positions. I really didn't expect this to happen, I am trying to hold all my position until it expire worthless.

So with my position in SHK, which had a strike of $110, at around 3pm the stock price is really close to my strike price. My first feeling of this Crisis is the impact should last for a few days. And if I get exercised from my SHK position. I will buy SHK at $110 which is the price I am happy to buy before the Dubai World Crisis. Now I am worry if I brought it at $110, the stock is likely to drop below $110 on Monday and it is still too early to tell the bottom. Therefore I have make a decision to close out my position with $0.32 per contract. Which means I still profit but not as much. As with my ESP position, due to some adjustment by the clearing house, my strike was actually lower to $48.8 which the reason I am not sure yet. At 3pm, the stock was trading at $50.5, which mean the chance of getting exercise is quite low. So I leave the ESP position open. And yesterday ESP close above $50, so my ESP position should expire worthless. Still waiting for the confirmation contract.


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