106 lines
3.1 KiB
Plaintext
106 lines
3.1 KiB
Plaintext
994
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Put option basics (continued)
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strategies, 245-247
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time value premium, 246-247
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Put option buying, 256-270
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as alternative to short sale of stock, 256-258
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purpose, 256
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equivalent positions, 270
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protected short sale, 270
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follow-up action, 262-266
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call option, 264
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listed call, buying, 263
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profits, five tactics for locking in, 262-266
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loss-limiting actions, 267-270
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calendar spread strategy, 269-270
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"rolling-up" strategy, 267-269
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margin account required, 269
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ranking prospective purchases, 261-262
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selection of which put to buy, 258-261
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delta, 260-261
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in-the-money puts, concentrating on, 259
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Put option strategies, 243-410 (see also under particular
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heading)
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basics, 245-255
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buying, 256-270
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call and put strategies, similarities between, 244
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LEAPS, 367-410
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listed put options newer than listed call options, 244
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put, sale of, 292-301
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put buying in conjunction with call purchases,
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281-291
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put buying in conjunction with common stock own-
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ership, 271-280
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put spreads, basic, 329-335
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ratio spreads using puts, 358-366
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spreads combining calls and puts, 336-357
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straddle, sale of, 302-320
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summary, 366
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synthetic stock positions created by puts and calls,
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321-328
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Put options, assignment of, 7
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Put spreads, basic, 329-335
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bear spread, 329-332
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advantage over call bear spread, 330-332
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as debit spread, 329
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bull spread, 332-333
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as credit spread, 332
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formulae, 333
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risk limited, 333
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calendar spread, 333-335
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bearish, 334-335
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neutral, 334
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option spreads, three simplest forms of, 329
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Index
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Qualified covered calls, 961-962
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Ratio calendar combination, 364-366 (see also Ratio
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spreads using puts)
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Ratio calendar spread, 222-225 (see also Calendar and
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ratio spreads)
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Ratio call spreads, 210-221
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and calendar spreads, combining, 222-229 (see also
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Calendar and ratio spreads)
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combination of bull spread and naked call write, 212
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definition, 210
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follow-up action, 217-221
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delta, adjusting with, 219-221
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equivalent stock position (ESP), using, 220-221
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profits, taking, 221
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ratio, reducing, 218-218
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philosophies, three differing, 213-217
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altering ratio, 215-216
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as ratio write, 213-214
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"delta spread," 213, 216-217
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for credits, 213, 214-215
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preferred over ratio writes, 211-212
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ratio write, similarity to, 210
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dissimilarity, 210-211
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summary, 221
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Ratio call write equivalent to naked straddle write, 306
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Ratio call writing, 146-171
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call spread strategies, introduction to, 168-171
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credit/debit spread, 170
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diagonal spread, 169
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horizontal spread, 169
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kicker, 169
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"leg" into spread, 171
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long/short side, 170
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splitting quote, 171
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spread, definition, 168
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spread order, 169-171
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vertical spread, 169
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combination of covered call writing and naked call
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writing, 146, 150
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definition, 146
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delta-neutral trading, 167-168
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follow-up action, 158-168
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altering ration of covered write, 160
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closing out write, 166-167
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delta, adjusting with, 160-163
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equivalent stock position (ESP), 162-163, 167
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position delta, 162-163, 167
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rolling up/down as defensive action, 160
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stop orders, using as defensive strategy, 163-166
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"telescoping" action points, 166-167
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investment required, 150-151
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and ratio call spreads, similarity to, 210 |