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Strategies & Market Trends : Roger's 1997 Short Picks

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To: The Perfect Hedge who wrote (8449)12/16/1997 11:19:00 AM
From: Sam Nizam  Read Replies (1) of 9285
 
I've never had it happen. The two positions mostly offset eachother. As long as they are covered at the same time your exposure is minimal.

It works because the spreads are narrow and the price for the Dec 30 put is way out of line. JBIL is currently 38 1/2. The Dec 30 puts (8 1/2 points out of the money) are 11/16 x 7/8 and the Dec 45 calls (6 1/2 points out of the money) are 5/16 x 1/2. I'm happy to take advantage of the disparity.

Sam
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