Add training workflow, datasets, and runbook

training_data/curated/text/1a2fa184a587f02bcd007d468c4b83156f82f484ee7397478751838494c9d833.txt

@@ -0,0 +1,38 @@
+Cl,apter 18: Buying Puts in Conjunction with Call Purchases 
+XYZ common, 45: 
+XYZ January 40 call, 7; 
+XYZ January 40 put, l; and 
+XYZ January 45 put, 3. 
+287 
+The straddle itself is now worth 8 points. The January 45 put price is included 
+because it will be part of one of the follow-up strategies. What could the straddle 
+buyer do at this time? First, he might do nothing, preferring to let the straddle run 
+its course, at least for three months or so. Assuming that he is not content to sit tight, 
+however, he might sell the call, taking his profit, and hope for the stock to then drop 
+in price. This is an inferior course of action, since he would be cutting off potential 
+large profits to the upside. 
+In the older, over-the-counter option market, one might have tried a technique 
+known as trading against the straddle. Since there was no secondary market for 
+over-the-counter options, straddle buyers often traded the stock itself against the 
+straddle that they owned. This type of follow-up action dictated that, if the stock 
+rose enough to make the straddle profitable to the upside, one would sell short the 
+underlying stock. This involved no extra risk, since if the stock continued up, the 
+straddle holder could always exercise his call to cover the short sale for a profit. 
+Conversely, if the underlying stock fell at the outset, making the straddle profitable 
+to the downside, one would buy the underlying stock. Again, this involved no extra 
+risk if the stock continued down, since the put could always be exercised to sell the 
+stock at a profit. The idea was to be able to capitalize on large stock price reversals 
+with the addition of the stock position to the straddle. This strategy worked best for 
+the brokers, who made numerous commissions as the trader tried to gauge the 
+whipsaws in the market. In the listed options market, the same strategic effect can 
+be realized ( without as large a commission expense) by merely selling out the long 
+call on an upward move, and using part of the proceeds to buy a second put similar 
+to the one already held. On a downside move, one could sell out the long put for a 
+profit and buy a second call similar to the one he already owns. In the example 
+above, the call would be sold for 7 points and a second January 40 put purchased for 
+1 point. This would allow the straddle buyer to recover his initial 6-point cost and 
+would allow for large downside profit potential. This strategy is not recommended, 
+however, since the straddle buyer is limiting his profit in the direction that the stock 
+is moving. Once the stock has moved from 40 to 45, as in this example, it would be 
+more reasonable to expect that it could continue up rather than experience a drop 
+of more than 5 points.