Add training workflow, datasets, and runbook

training_data/curated/text/f3fa7918d228f87dfb59e2a0727db1999837a675c5ad5d64e84eec6a39c607f6.txt

@@ -0,0 +1,35 @@
+O.,,ter 32: Structured Products 623 
+TI1is is the typical picture of the total return from a covered write - potential losses on 
+the downside with profit potential limited above the striking price of the written call. 
+Now look at the profitability of buying the PER CS at 35 and holding it for three 
+(Assume that it is not called prior to maturity.) The PER CS holder will earn a 
+total of $750 in dividends over that time period. 
+XYZ Price Profit/Loss on Total Profit/Loss 
+in 3 Years PERCS Incl. Dividend 
+25 -$1,000 -$250 
+30 -500 +250 
+35 0 +750 
+>=39 +400 + 1, 150 
+This is exactly the same profitability as the covered call write. Therefore, it can be 
+concluded with certainty that a PERCS is equivalent to a covered call write. Note 
+that the PER CS potential early redemption feature does not change the truth of this 
+statement. The early redemption possibility merely allows the PERCS holder to 
+receive the same total dollars at an earlier point in time if the PERCS is demanded 
+prior to maturity. The covered call writer could theoretically be facing a similar situ­
+ation if the written call option were assigned before expiration: He would make the 
+same total profit, but he would realize it in a shorter period of time. 
+The PERCS is like a covered write of a call option with striking price equal to 
+the redemption price of the PERCS, except that the holder does not receive a call 
+option premium, but rather receives additional dividends. In essence, the PERCS 
+has a call option imbedded within it. The value of the imbedded call is really the 
+value of the additional dividends to be paid between the current date and maturity. 
+The buyer of a PERCS is, in effect, selling a call option and buying common 
+stock. He should have some idea of whether or not he is selling the option at a rea­
+sonably fair price. The next section of this chapter addresses the problem of valuing 
+the call option that is imbedded in the PERCS. 
+PRICE BEHAVIOR 
+The way that a PERCS price is often discussed is in relationship to the common 
+stock. One may hear that the PERCS is trading at the same price as the common or 
+at a premium or discount to the common. As an option strategist who understands 
+covered call writing, it should be a simple matter to picture how the PERCS price 
+will relate to the common price.