Allen; It's called a reverse conversion, you have to shop the
options and plan it. It takes advantage of time premium, the more
you buy the cheaper the "time" is..in effect you are buying and
selling time. You pick calls further out in time..at a price
to risk factor you chose, you buy the calls, short the stock
then sell puts. "You sell puts," if she gets put to you it closes
your short. Normally you sell puts in shorter time frames as you
get more for them. There has been a lot of money made this way,
go ask Michel Burke when it got started some years ago.
It is not a play for dim wits you really have to crunch numbers.
Sounds like you want to pick on it just to pick on something,
get your ducks in row before you try to knock them down,
with some off the wall bank shot.
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I made it clear you sell ( write ) the
puts , I didn't, and don't intend to give a full course in
options on SI , but I could write a book on them.
I will add you have to find were you get more over time selling
the puts than you have to pay for the calls, that's your
profit margin if she don't fall. If she does you make the short
and the puts u sold pays for the calls, it gets more complicated
as u get into rolling positions..I doubt u would want to fool
with it , as it requires a little thinking. <G>
Jim
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