Add training workflow, datasets, and runbook

training_data/curated/text/63db0a14ccb6fc2c445295ac861a37d27cda431d4ea6a4003a393bc29bd312ff.txt

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+OPTION TrAdINg STrATegIeS
+Comment. This strategy provides an interesting alternative method of pyramiding—that is, increas-
+ing the size of a winning position. For example, a trader who is already long a futures contract at a 
+profit and believes the market is heading higher may wish to increase his position without doubling 
+his risk in the event of a price reaction—as would be the case if he bought a second futures contract. 
+Such a speculator could choose instead to supplement his long position with the purchase of a call, 
+thereby limiting the magnitude of his loss in the event of a price retracement, in exchange for real-
+izing a moderately lower profit if prices continued to rise.
+Figure 35.9 compares the alternative strategies of buying two futures versus buying a futures con-
+tract and a call. (For simplicity of exposition, the diagram assumes that both the futures contract and 
+the call are purchased at the same time.) As can be seen, the long two futures position will always do 
+moderately better in a rising market (by an amount equal to the premium paid for the call), but will 
+lose more in the event of a significant price decline. The difference in losses between the two strate-
+gies will widen as larger price declines are considered.
+Strategy 10: bearish “texas Option hedge” (Short Futures +  
+Long put)
+example. Sell August gold futures at $1,200 and simultaneously buy an August $1,200 gold put at a 
+premium of $38.70/oz ($3,870). (See Table 35.10 and Figure 35.10.)
+Comment. This strategy is perhaps most useful as an alternative means of increasing a short position. 
+As illustrated in Figure 35.10, the combination of a short futures contract and a long put will gain 
+moderately less than 2 short futures contracts in a declining market, but will lose a more limited 
+amount in a rising market.
+tabLe 35.10 profit/Loss Calculations: bearish “texas Option hedge” (Short Futures + Long put)
+(1) (2) (3) (4) (5) (6)
+Futures price at 
+expiration ($/oz)
+premium of august $1200 
+put at Initiation ($/oz)
+$ amount of 
+premium paid
+profit/Loss on Short 
+Futures position
+put Value at 
+expiration
+profit/Loss on position 
+[(4) + (5) – (3)]
+1,000 38.7 $3,870 $20,000 $20,000 $36,130
+1,050 38.7 $3,870 $15,000 $15,000 $26,130
+1,100 38.7 $3,870 $10,000 $10,000 $16,130
+1,150 38.7 $3,870 $5,000 $5,000 $6,130
+1,200 38.7 $3,870 $0 $0 –$3,870
+1,250 38.7 $3,870 –$5,000 $0 –$8,870
+1,300 38.7 $3,870 –$10,000 $0 –$13,870
+1,350 38.7 $3,870 –$15,000 $0 –$18,870
+1,400 38.7 $3,870 –$20,000 $0 –$23,870