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    he covered call strategy and how we are better
    off collecting premiums over a period of time, not paying them
    out. By selling the call, we collect premium which can be used
    to off
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    Another protective strategy that allows for some upside capital
    gain while providing maximum down side protection is the collar.

    The collar is a combination of the covered call and protective
    put strategies. The collar uses a long put position in
    coordination with a short call position along with a long stock
    position. The ratio is one short call, one long put (not of the
    same strike) and 100 shares of stock.

    As you remember, one contract is equal to 100 shares. The
    options that we will use to construct this strategy will be
    out-of-the-money puts and calls.

    The object here is to construct a protective put strategy
    without having to pay for the purchase of the put. We talked
    about premium in the covered call strategy and how we are better
    off collecting premiums over a period of time, not paying them
    out. By selling the call, we collect premium which can be used
    to offs
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    nd protective
    put strategies. The collar uses a long put position in
    coordination with a short call position along with a long stock
    position. The ratio is one short call, one long put (not of the
    same strike) and 100 shares of stock.

    As you remember, one contract is equal to 100 shares. The
    options that we will use to construct this strategy will be
    out-of-the-money puts and calls.

    The object here is to construct a protective put strategy
    without having to pay for the purchase of the put. We talked
    about premium in the covered call strategy and how we are better
    off collecting premiums over a period of time, not paying them
    out. By selling the call, we collect premium which can be used
    to off
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    put (not of the
    same strike) and 100 shares of stock.

    As you remember, one contract is equal to 100 shares. The
    options that we will use to construct this strategy will be
    out-of-the-money puts and calls.

    The object here is to construct a protective put strategy
    without having to pay for the purchase of the put. We talked
    about premium in the covered call strategy and how we are better
    off collecting premiums over a period of time, not paying them
    out. By selling the call, we collect premium which can be used
    to off
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    r> out-of-the-money puts and calls.

    The object here is to construct a protective put strategy
    without having to pay for the purchase of the put. We talked
    about premium in the covered call strategy and how we are better
    off collecting premiums over a period of time, not paying them
    out. By selling the call, we collect premium which can be used
    to off
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    he covered call strategy and how we are better
    off collecting premiums over a period of time, not paying them
    out. By selling the call, we collect premium which can be used
    to offset the capital outlay we incurred for the put purchase.

    We said that two of three scenarios in the covered call strategy
    were positive while the protective put scenario had only one
    scenario that produced a positive outcome.
    However, the protective put was the strategy that provided the
    most downside protection. The challenge was to construct a
    protective put strategy without paying out money. The solution
    is the collar strategy.

    The collar takes on the characteristics of both the protective
    put and covered call strategies. Like the covered call, there is
    an upside cap on profits and like the protective put there is
    unlimited downside protection.

    Ideally, the collar is set up to be an “even”

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    BB link (for phorums):
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