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What you have done is create a situation of limited profit and unlimited
risk. Not to hard to figure. Add the price of the put you sell to the
strike price and everything above that is loss point for point with a rise
in the stock or future price.
----- Original Message -----
From: "prosper1000" <prosper1000@xxxxxxxxx>
To: <realtraders@xxxxxxxxxxxxxxx>
Sent: Thursday, March 27, 2003 6:23 PM
Subject: Re: [RT] What's wrong with the stratagie in #21907?/Ray et al
> Here is is Ray,
>
> It should have been sell an at the money put and sell the underlying.
> I want to know if I am clear about what can go wrong if the price
> goes up, stays about the same, or goes down. If the price goes down
> the the loss on the option and the gain on the underlying should
> cancel out. If it goes up, you maintain the value of the sold put,
> but you lose on the sell of the underlying. I guess that a stop,
> would stop the loss on the underlying, but then your put would be
> naked agian.
>
> Thanks again.
>
> Prosper
>
>
> --- In realtraders@xxxxxxxxxxxxxxx, "Ray Raffurty" <r.raffurty@xxxx>
> wrote:
> > Hi Prosper,
> >
> > No I didn't get the second post. I've noticed that happens
> sometimes with Real Traders and/or Yahoo. What did it say?
> >
> > Good luck and good trading,
> >
> > Ray Raffurty
> >
> > ----- Original Message -----
> > From: prosper1000
> > To: realtraders@xxxxxxxxxxxxxxx
> > Sent: Thursday, March 27, 2003 1:24 PM
> > Subject: Re: [RT] What's wrong with the stratagie in #21907?/Ray
> et al
> >
> >
> > Hi Ray,
> >
> > Did you read message #21907? I got the origionaly stratagy in my
> > first post wrong. I redefined it in post #21907. Sorry about
> that. I
> > would still like to hear what you and others have to say about
> it.
> > Thanks
> >
> > Prosper
> >
> > --- In realtraders@xxxxxxxxxxxxxxx, "Ray Raffurty"
> <r.raffurty@xxxx>
> > wrote:
> > > Hi Prosper,
> > >
> > > There is nothing wrong with any strategy as long as you
> understand
> > the possible risks and rewards:
> >
> >
> >
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> >
> >
> >
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>
>
>
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