Well no that's why a covered call has the same payoff pattern as a short put. But usually with a covered call, people already own the stock so the shares's downside not being covered is a given. The point in a covered call is that the short call is covered hence the term "covered call". If you want to protect the underlying stock's downside, you can buy a protective put. I hope that answered your question.
My point was that similar to short put there is a risk to the downside and from that point of view, CC and short put are similar. Was just trying to make you understand. But whatever man troll on.
Cmon D,its a simple strategy that has seen its better days,but has relevance to you.. Long stock + long put + short call. Same strike
That strategy is called a "conversion"? A synthetic long call + short call? Basically "converting" the covered call to a synthetic verical call spread? I have thought of that strategy but I never knew that strategy is called a "conversion". So the purpose of that long put is to protect the potential downside of the long stock like what I said before? I agree that strategy is useful. But that would be just a credit call spread, OP has already listed that strategy in his first post. LOL I can see why it's seen its better days because it would be easier to just do a vertical call spread unless you really want to hold the underlying.
I already wrote: That's implied that the downside of a stock would not be protected but that's a given. Learn to read please.
Inside joke from months ago where @TheDawn tried to explain his "infinite gamma" theory and then wouldn't listen to anyone offering him common sense. Wish I could find the thread now, iirc must've been late last year some time. Uh, yeah, I think it started here and the rest should make you laugh a bit.
Yep; that sounds like TheDawn that I remember. I see @cesfx has posted the link. Off I go, dumpster diving... Thanks, guys!
Yeah, me too prefers such constructs with built-in hedging, ie. spreads etc. Mine: Spreads CC / CSP Collar Straddle, Strangle Butterfly Condor Btw, ignore this @TheDawn, as mostly he has no clue.
Had to log out to read it, and - yeah. Sounds like someone who was bullied in disgusting ways when young and is now attempting to reenact those times but "win" over his imaginary tormentors; that kind of weaponized ignorance and triumphant malice doesn't just appear out of thin air. I managed to hang on for about three pages, but that was about it. Anything more would be masochistic. Blocked he is, and blocked he stays.