Chapter 1: Definitions 25 
MORE STRIKING PRICE CODES 
The letters A through T cannot handle all of the possible striking price codes. Recall 
that many stocks, especially lower-priced ones, have striking prices that are spaced 
2½ points apart. In those cases, a special letter designation is usually used for the 
striking price codes: 
Striking Price Code 
u 
V 
w 
X 
y 
z 
Possible Meanings 
7.5 or 37.5 or 67.5 or 97.5 or even 127.5! 
12.5 or 42.5 or 72.5 or 102.5 or 132.5 
17.5 or 47.5 or 77.5 or 107.5 or 137.5 
22.5 or 52.5 or 82.5 or 112.5 or 142.5 
27.5 or 57.5 or 87.5 or 117.5 or 147.5 
32.5 or 62.5 or 92.5 or 122.5 or 152.5 
Typically, only the first or second meaning is used for these letters. The higher-priced 
ones only occur after a very expensive stock splits 2-for-l (say, a stock that had a strike 
price of 155 and split 2-for-l, creating a strike. price of 155 divided by 2, or 77.50). 
WRAPS 
Note that any striking price code can have only one meaning. Thus, if the letter A is 
being used to designate a strike price of 5, and the underlying stock has a tremen­
dous rally to over $100 per share, then the letter A cannot also be used to designate 
the strike price of 105. Something else must be done. In the early years of option 
trading, there was no need for wrap symbols, but in recent - more volatile - times, 
stocks have risen 100 points during the life of an option. 
For example, if XYZ was originally trading at 10, there might be a 9-month, XYZ 
December 10 call. Its symbol would be XYZLB. If, in the course of the next few 
months, XYZ traded up to nearly 110 while the December 10 call was still in exis­
tence, the exchange would want to trade an XYZ December 110 call. But a new let­
ter would have to be designated for any new strikes (A already stands for 5, so it can­
not stand for 105; B already stands for 10, so it cannot stand for 110, etc.). There 
aren't enough letters in the alphabet to handle this, so the exchange creates an addi­
tional option base symbol, called a wrap symbol. 
In this case, the exchange might say that the option base symbol XYA is now 
going to be used to designate strike prices of 105 and higher ( up to 200) for the com­
mon stock whose symbol is XYZ. Having done that, the letter A can be used for 105, 
B for 110, etc.