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johnson232

Registered: Jan 2009
Posts: 11

11-03-09 07:31 PM

I have 30 contracts Nov 185/180
I really don't want to buy 3000 shares of apple. My max risk is around 4k
is Ratio back spread a good idea. I don't really want collar.

Thanks in advance

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wayneL

Registered: Nov 2005
Posts: 167

11-03-09 08:02 PM

Quote from johnson232:

I don't really want collar.

Thanks in advance

Why?

It's just the synthetic of what you already have.

PS - If you don't want the shares, roll the options out/up/down/whatever or just exit.

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dagnyt

Registered: Nov 2003
Posts: 1773

11-03-09 09:12 PM

Quote from johnson232:

I have 30 contracts Nov 185/180
I really don't want to buy 3000 shares of apple. My max risk is around 4k
is Ratio back spread a good idea. I don't really want collar.

Thanks in advance

If AAPL finishes over 185, you will not have a stock position.

If stock is below 185, and you don't want 3000 shares of AAPL, BE CERTAIN TO SELL YOUR LONG OPTIONS PRIOR TO EXPIRATION.

Cover the shorts if necessary.

Mark

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johnson232

Registered: Jan 2009
Posts: 11

11-03-09 09:23 PM

Thanks guys I have engaged a professional to make these trades and I was shocked to see what happened to my portfolio last week. I have been assured that things look much worse than they are and to just hang in.

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spindr0

Registered: Nov 2005
Posts: 1838

11-04-09 01:16 AM

Quote from johnson232:

Thanks guys I have engaged a professional to make these trades and I was shocked to see what happened to my portfolio last week. I have been assured that things look much worse than they are and to just hang in.

LOL. Simple numbers don't look any better or worse than they are. Your P&L is what the quotes tell you it is and someone's assurances of anything different are worthless.

Make sure your "professional" knows what he is doing and even more importantly, make sure you understand what he is doing and that it is acceptable to you.

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dagnyt

Registered: Nov 2003
Posts: 1773

11-04-09 02:12 AM

Quote from johnson232:

I have engaged a professional to make these trades .

BIG mistake

Mark

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