Abstract
The most basic form of an installment strategy involves a single LEAPS position, offset by a series of single-option short positions (either calls or puts). However, this does not limit the possible combinations and variations of the strategy. Beyond these basic structures and formats, a broad number of variations may also be employed. These involve degrees of profit potential and risk, and traders should be aware of these before entering advanced trades.
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Notes
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Greenleaf, R. (1989). Synthetic instruments. Financial Analysts Journal, Volume 45, No. 2, pp. 71–73.
- 2.
McMillan, L. (2002). Options as a Strategic Investment, 4th Ed. New York: New York Institute of Finance, p. 323.
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Rhoads, Russell (2011). Option Spread Trading: A Comprehensive Guide to Strategies and Tactics. Hoboken NJ: Wiley, p. 48.
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Cohen, Guy. (2005). The Bible of Options Strategies: The Definitive Guide for Practical Trading Strategies. Upper Saddle River NJ: FT Press, 2005, p. 37.
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Thomsett, M.C. (2018). Alternative Offsets Beyond Short Calls or Short Puts. In: Options Installment Strategies. Palgrave Macmillan, Cham. https://doi.org/10.1007/978-3-319-99864-0_8
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DOI: https://doi.org/10.1007/978-3-319-99864-0_8
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Publisher Name: Palgrave Macmillan, Cham
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Online ISBN: 978-3-319-99864-0
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