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Strategies & Market Trends : The Covered Calls for Dummies Thread

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To: EnricoPalazzo who wrote (485)	5/9/2001 2:05:42 AM
From: tekboy	Read Replies (3) of 5205

I recall a rather odd scenario from one of my problem sets in college where the question was "should you use the arithmetic or the geometric average?". My TA told the section that I was the only person in the section to get it right. I was quite pleased, until I started to think about it. About halfway through class, I pointed out to my TA that I had in fact gotten the question wrong, and that everyone else had gotten it right. He argued back, and ultimately disagreed (the textbook was no help, as it gave contradictory answers in different chapters). About a week later, he emailed the section to say that in fact I was right in saying that I was wrong, and gave them credit for the answer--although I'm not sure if I got points taken off my problem set. Anyway, while I now believe that both answers are somewhat valid, depending on your attitude towards diversification, this certainly indicates that the question is a tricky one. BTW, that was the last time I went to section. 'course, at a decent college you'd have been taught by professors and not grad students... dtb

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