J L Lord's collar strategy book

Discussion in 'Options' started by fh2000, Mar 30, 2006.

  1. fh2000


    I have seen this book being mentioned in Optionetics, but I can't seem to find the website that sells this book. I heard it is $300 a copy.

    Has anyone read or heard about this book? What is your opinion about it?
  2. $300 for a book on collars???

    www.888options.com look up collar strategies :D

    That will be $200 please we are having a sale today.
    SmokingAces likes this.
  3. fh2000


    I see how you liked the book. :)

    Well, it is supposed to be some kind of "managed collar strategy". You own or buy stocks, then buy puts for protection. Instead of selling calls right away like the basic collar strategy, you would wait until neutral or bearish then sell calls.

    When stock goes down, you sell the puts for profit and buy more stocks from the profit.

    What I am not clear about is the timing of when to roll up or down your puts and calls. That's why it costs $300, I guess.
  4. You described it pretty well. I bet with some study you can come up with your own way to trade it.
  5. If you're buying puts for protection aren't you already bearish?
  6. fh2000


    My motivation of understanding this managed collar strategy is because of our ESPP stocks for both myself and my wife's. A large portion of them are in regular accounts and not in IRA.

    For whatever reason, people are emotionally attached to their stocks. So am I, I guess, specially these are your own companies. Plus, I do not want to pay capital gains unless it is absolutely necessary. I would like to keep the stocks; protect the possible down turn; and enjoy the up turn as much as possible.

    The traditional collar strategy calls for buying puts and selling calls at the same time. This provides protection, but also limits the upside. Therefore, it is a conflict to what I wish to accomplish. I do not think this is a bearish strategy. Puts are there to provide the insurance.

    I think what I need to figure out are, amoung other things:
    1. How not to spend too much to buy the insurance.
    2. How not to have my stocks getting called away if I sell calls.

    I welcome any suggestions, flames, criticism. I opened my mouth, and will certain expect any unexpected from you all experienced traders. :)
  7. satanama


    Could you please provide a link to the page were J L Lord's book is discussed?

    Is it the same strategy you can find at tsueiconsultants.com? Here you can find the Calendar Collar strategy variation (which originally Alan Bernstein came up with), and a couple of variations of the original strategy. BTW, they're on PDF format and you can download them for free.

    All the best

    Iñaki Aguirre
  8. Your short calls will not be called as long as they have some premium over intrinsic value, ignoring any potential dividend plays. The possible flaw to your plan for legging into the collar is that the stock could go sideways and you would be burning theta on your puts without negative theta from the short calls to offset it.

    Charles Cottle teaches a slingshot collar that involves selling OTM call verticals at a two or more ratio and buying ATM puts. By selling a vertical, you participate in any movement above the higher strike. Of course, you underperform if the stock is between the strikes on expiration.
  9. Alrosa


  10. fh2000


    Satanama, thanks for posting this link. I read thru their strategy and it looks better than my buy/hold and CC. I wonder why they put up the site with no advertising. I imagine Lord's $300 dollar book must be some similar strategy than this.
    #10     Apr 5, 2006