Add training workflow, datasets, and runbook

training_data/curated/text/2462bee4c59035ff450ab88669a147eccad4e8c92f51380233722c05eb39cdbd.txt

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+Accepting Exposure   • 225
+Tactically, once an investor has decided to accept exposure to a stock’s 
+upside potential using a call spread, he or she has a relatively limited choice 
+of investments. Let’s assume that we sell the ATM strike; in the IBM ex-
+ample shown earlier, there is a choice of nine strike prices at which we 
+can cover. The highest dollar amount of premium we can receive—what I 
+will call the maximum return—is received by covering at the most distant 
+strike. Every strike between the ATM and the most distant strike will at 
+most generate some percentage of this maximum return.
+Now let’s look at the risk side. Let’s say that we sell the $195-strike call 
+and cover using the $210-strike call. Now assume that some bit of good 
+news about IBM comes out, and the stock suddenly moves to exactly $210. 
+If the option expires when IBM is trading at $210, we will have lost the 
+entire amount of margin we posted to support this investment—$15 in all. 
+This $15 loss will be offset by the amount of premium we received from 
+selling the call spread—$5.47 in the IBM example—generating a net loss of 
+$9.53 (= $5.47 − $15). Compare this with the loss that we would suffer if we 
+had covered using the most distant call strike. In this case, we would have 
+received $6.96 in premium, so if the option expires when IBM is trading at 
+the same $210 level as earlier, our net loss would be $8.04 (= $6.96 − $15). 
+Because our maximum return is generated with the widest spread, it fol-
+lows that our minimum loss for the stock going to any intermediate strike 
+price also will be generated with the widest spread.
+At the same time, if we always select the widest spread, we face an 
+entirely different problem. That is, the widest spread exposes us to the great-
+est potential loss. If the stock goes only to $210, it is true that the widest 
+spread will generate a smaller loss than the $195–$210 spread. However, in 
+the extreme, if the stock moves up strongly to $240, we would lose the $45 
+gross amount supporting the margin account and a net amount of $38.04 
+(= $45 – $6.96). Contrast this with a net loss of $9.53 for the $195–$210 
+spread. Put simply, if the stock moves up only a bit, we will do better with 
+the wider spread; if it moves up a lot, it is better to choose a narrower 
+spread. 
+In short, when thinking about call spreads, we must balance our 
+amount of total exposure against the exposure we would have for an inter-
+mediate outcome against the total amount of premium we are receiving. If 
+we are too protective and initiate the smallest spread possible, our chance