How might the split influence the pricing and availability of options and other derivatives on SLRX?

Impact on Options and Derivatives

A 1‑for‑15 reverse split will compress SLRX’s share price roughly 15‑fold, moving it from a low‑priced, high‑beta “penny‑stock” zone into a mid‑range level that is more palatable to the Nasdaq Capital Market and to institutional participants. Because options are quoted in dollar increments, the new price will generate strikes that are tighter and more realistic relative to the underlying, reducing the “wide‑gap” effect that often plagues deep‑out‑of‑the‑money (OTM) contracts on sub‑$1 stocks. Expect the exchange to rebalance the existing option series: all open‑interest and open‑position contracts will be adjusted by the 1/15 factor (e.g., a 0.50‑share contract becomes 0.033 share, and the strike price is divided by 15). This mechanical conversion will temporarily thin the market for the legacy series, but the post‑split series will attract new liquidity as market makers can more easily hedge with a higher‑priced underlying.

Pricing dynamics

The reverse split itself does not change the intrinsic value of the company, but the higher nominal price will likely lower the implied volatility (IV) component in the Black‑Scholes model because the stock will now sit in a price band where historical price swings represent a smaller percentage move. Lower IV compresses option premiums, especially for OTM strikes, making it cheaper for speculative buyers but also reducing the “volatility premium” that many short‑term traders exploit. However, the adjustment will also improve the delta and gamma profiles of the options: delta values will be more linear across strikes, and gamma will be less extreme, which helps both hedgers and speculators manage risk.

Actionable take‑aways

1. Re‑evaluate existing positions – If you hold pre‑split options, verify the adjusted contract specifications (share multiplier, strike price, and expiration) and recalculate Greeks. The reduced delta may require tighter hedging.
2. Target the new series – Anticipate tighter bid‑ask spreads and higher open‑interest as market makers re‑quote options on the post‑split stock. Initiate new positions on the 15‑adjusted strikes rather than chasing the legacy series, which will likely see diminished volume.
3. Volatility outlook – Expect a short‑term dip in IV as the market digests the price change, followed by a possible rebound if the underlying’s fundamentals (clinical trial milestones, cash‑burn, partnership news) drive true price movement. Position accordingly: consider buying near‑ATM options to capture upside while using the lower IV to keep premium outlay modest, and use spreads to hedge against residual liquidity risk.