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Technology Stocks : America On-Line: will it survive ...? -- Ignore unavailable to you. Want to Upgrade?

To: yard_man who wrote (6959)1/23/1998 12:46:00 PM
From: vegetarian  Read Replies (2) | Respond to of 13594
 
Which in options lingo is called as a "synthetic short", the premium from selling calls supports buying puts.



To: yard_man who wrote (6959)1/23/1998 3:06:00 PM
From: White Shoes  Read Replies (2) | Respond to of 13594
 
I have been thinking the same thing, more or less...this combination takes advantage of premium but gives you a bit of leverage too...of course you have to be making the correct call on the stock's direction in the first place, but nothing in life is free.



To: yard_man who wrote (6959)1/26/1998 4:29:00 PM
From: Tim Kenney  Respond to of 13594
 
>Sell the calls and buy the puts at the same strike 6
months out to generate a small credit. Then on a monthly basis buy a substantially
higher strike call to protect the position from a runaway.<

The first sentence represents a straight short sale. When you add the high strike call on top, you create a high strike put.


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