Add training workflow, datasets, and runbook

training_data/curated/text/a8696384c08f70d8669621651ee499de7a8eb77c3626f72bce99e4f267058af2.txt

@@ -0,0 +1,35 @@
+158 Part II: Call Option Strategies 
+FOLLOW-UP ACTION 
+Aside from closing the position completely, there are three reasonable approaches to 
+follow-up action in a ratio writing situation. The first, and most popular, is to roll the 
+written calls up if the stock rises too far, or to roll down if the stock drops too far. A 
+second method uses the delta of the written calls. The third follow-up method is to 
+utilize stops on the underlying stock to alter the ratio of the position as the stock 
+moves either up or down. In addition to these types of defensive follow-up action, the 
+investor must also have a plan in mind for taking profits as the written calls approach 
+expiration. These types of follow-up action are discussed separately. 
+ROLLING UP OR DOWN AS A DEFENSIVE ACTION 
+The reader should already be familiar with the definition of a rolling action: The cur­
+rently written calls are bought back and calls at a different striking price are written. 
+The ratio writer can use rolling actions to his advantage to readjust his position if the 
+underlying stock moves to the edges of his profit range. 
+The reason one of the selection criteria for a ratio write was the availability of 
+both the next higher and next lower striking prices was to facilitate the rolling actions 
+that might become necessary as a follow-up measure. Since an option has its great­
+est time premium when the stock price and the striking price are the same, one 
+would normally want to roll exactly at a striking price. 
+Example: A ratio writer bought 100 XYZ at 49 and sold two October 50 calls at 6 
+points each. Subsequently, the stock drops in price and the following prices exist: 
+XYZ, 40; XYZ October 50, l; and XYZ October 40, 4. 
+One would roll down to the October 40 calls by buying back the 2 October 
+50's that he is short and selling 2 October 40's. In so doing, he would reestablish a 
+somewhat neutral position. His profit on the buy-back of the October 50 calls 
+would be 5 points each - they were originally sold for 6 - and he would realize a 
+10-point gain on the two calls. This 10-point gain effectively reduces his stock cost 
+from 49 to 39, so that he now has the equivalent of the following position: long 100 
+XYZ at 39 and short 2 XYZ October 40 calls at 4. This adjusted ratio write has a 
+profit range of 31 to 49 and is thus a new, neutral position with the stock currently 
+at 40. The investor is now in a position to make profits if XYZ remains near this 
+level, or to take further defensive action if the stock experiences a relatively large 
+change in price again. 
+Defensive action to the upside - rolling up -works in much the same manner.