Learning To Invest

Combination Write-Strangle: Sell Out Of The Money Call (S=55) And Put (S=45)


             Risk: Unlimited-both up and down
             Profit Potential: Limited-between strikes
             Equivalent Positions: None
             Follow-up Action: Roll up or down


The Calendar Combination (52.5):Call Calendar Spread on Higher Strike (S=50), Put Calendar Spread On Lower Strike      (S=50)

             Risk: Limited-up and down
             Profit Potential: Limited-near strikes
             Equivalent Positions: None
             Follow-up Action: None


Calendar Ratio Spread (Call): Buy Long Term Call (S=50, T=.5) And Sell More Than One Short Term Call (S=50)
     Against It

             Risk: Unlimited-upside
             Profit Potential: Limited-at strike
             Equivalent Positions: None
             Follow-up Action: Close out position if stock breaks out to the upside