How Does a “Fork” in Financial Derivatives Relate to a Corporate Action in Equities?

A "fork" in financial derivatives, while not a direct term, is analogous to a contract adjustment following a corporate action like a stock split, merger, or spin-off in equities. A blockchain fork creates a new asset or chain, requiring derivatives contracts to specify how they will handle the new reality.

Similarly, a corporate action requires a derivatives clearing house to adjust the contract terms (e.g. strike price, multiplier, number of contracts) to maintain the economic equivalence of the original derivative position.