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Strategies & Market Trends : Advanced Option Strategies

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To: Greg Higgins who wrote ()1/25/2000 9:08:00 PM
From: OX  Read Replies (1) of 355
 
short term bearish, longer term bullish strategy...

Greg, what do you or anyone else think of a reverse calendar put spread...

buy OTM put front month
sell similar OTM naked put next month out (or longer) being careful to match the delta/theta as much as possible.

the goal is to sell the long put when some pre-established goal is reached. keep the NP for when the underlying recovers.

the purpose of the NP is in case the underlying rallies, you can close both the long and short put and probably be out only commission (and perhaps the B/A spread). or take your lumps on the long and keep the short.
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