Add training workflow, datasets, and runbook

training_data/curated/text/623e96c69540e24e2a974b953ccc89434e596290a8719ac56215c421910b52a7.txt

@@ -0,0 +1,38 @@
+362 Part Ill: Put Option Strategies 
+less. Also, the position should be established for a credit, such that the money 
+brought in from the sale of the near-term puts more than covers the cost of the 
+longer-term put. If this is done and the near-term puts expire worthless, the strate­
+gist will then own the longer-term put free, and large profits could result if the stock 
+subsequently experiences a sizable downward movement. 
+Example: If XYZ were at 55, and the January 50 put was at 1 ½ with the April 50 at 
+2, one could establish a ratio put calendar spread by buying the April 50 and selling 
+two January 50 puts. This is a credit position, because the sale of the two January 50 
+puts would bring in $300 while the cost of the April 50 put is only $200. If the stock 
+remains above 50 until January expiration, the January 50 puts will expire worthless 
+and the April 50 put will be owned for free. In fact, even if the April 50 put should 
+then expire worthless, the strategist will make a small profit on the overall position in 
+the amount of his original credit - $100 - less commissions. However, after the 
+Januarys have expired worthless, if XYZ should drop dramatically to 25 or 20, a very 
+large profit would accrue on the April 50 put that is still owned. 
+The risk in the position could be very large if the stock should drop well below 
+50 before the January puts expire. For example, if XYZ fell to 30 prior to January 
+expiration, one would have to pay $4,000 to buy back the January 50 puts and would 
+receive only $2,000 from selling out his long April 50 put. This would represent a 
+rather large loss. Of course, this type of tragedy can be avoided by taking appropri­
+ate follow-up action. Nomwlly, one would close the position if the stock fell rrwre than 
+8 to 10% below the striking price before the near-term puts expire. 
+As with any type of ratio position, naked options are involved. This increases the 
+collateral requirement for the position and also means that the strategist should allow 
+enough collateral in order for the follow-up action point to be reached. In this exam­
+ple, the initial requirement would be $750 (20% of $5,500, plus the $150 January 
+premium, less the $500 by which the naked January 50 put is out-of-the-money). 
+However, if the strategist decides that he will hold the position until XYZ falls to 46, 
+he should allow $1,320 in collateral (20% of $4,600 plus the $400 in-the-money 
+amount). Of course, the $100 credit, less commissions, generated by the initial posi­
+tion can be applied against these collateral requirements. 
+This strategy is a sensible one for the investor who is willing to accept the risk of 
+writing a naked put. Since the position should be established with the stock above the 
+striking price of the put options, there is a reasonable chance that the near-term puts 
+will expire worthless. This means that some profit will be generated, and that the 
+profit could be large if the stock should then experience a large downward move 
+before the longer-term puts expire. One should take care, however, to limit his losses