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Strategies & Market Trends : Calls and Puts for Income -- Ignore unavailable to you. Want to Upgrade?

To: Bocor who wrote (5866)	2/25/2014 9:38:43 AM
From: alanrs	Respond to of 5891

It's a synthetic long and acts similarly to owning the stock with less money tied up. I've been watching it since Jim P mentioned and might want to try a few puts at a 35 strike if and when. Not meaning to preempt anybody, just up and around this morning. ARS

To: Bocor who wrote (5866)	2/25/2014 10:49:48 AM
From: Jim P.	Read Replies (2) \| Respond to of 5891

I hate paying for time value. In this case a synthetic long is created. My margin requirement is the short put requirement. If ATLS is at $40 in 2 years then I will have a short term gain of x dollars per share for the puts and a long term loss of x dollars for the long calls. Anything above $40 and I start gaining on the long call side while the gain on the short put has already been maxed out. I think $50 to $60 is not unreasonable and at $60 I would have some long term gains on the calls. No k1 hassles to deal with and 2 years gives the company time to grow into the over priced purchases of 2013. Bottom line is I hope the short puts pay for the long call position and think the trade has a much greater chance of success over 2 years than a closer duration. Jim