Nov 21, 2018
Huddle up, traders! For your listening pleasure, Mark and Brian
answer your burning options trading questions, including:
- Question from Barry Brown - Good morning. Have the show
archives been withdrawn or are they still available? Question: If
we put on a poor man's covered call position and the price moves up
the short call, when do you recommend rolling, etc? Thank you. Your
stuff is great. Really enjoy all you efforts. Thank you.
- Question from Douglas Tilley - Hello! Regarding long stock
1. With call options, are deltas additive? I.e. why are (2)
40-delta calls so much cheaper than (1) 80-delta call? This seems
like buying equivalent total delta for about half the cost.
2. For more accurate stock substitution, do you ever use the
technique of buying an ATM call while selling an ATM put? (Vs.
buying calls for a desired total delta).
What are the pros and cons (or nuances) of the 2 methods? I do
notice that the 2nd method definitely requires more buying power,
due to the short put. Thanks for all the education - D Tilley,
- Question from Splitsville - Why is long put/covered call a
"collar" while short put/long call is a "risk reversal." Never
understood that one.