RE: [TheOptionClub.com] GS TRADE [was:How do you manage your Vega?]

 

Yes, on a hard to borrow situation there are added risks. However those
risks are also usually reflected in very strange option prices as well.

-----Original Message-----
From: OptionClub@yahoogroups.com [mailto:OptionClub@yahoogroups.com] On
Behalf Of Ricky Jimenez
Sent: Monday, May 17, 2010 10:39 PM
To: OptionClub@yahoogroups.com
Subject: Re: [TheOptionClub.com] GS TRADE [was:How do you manage your Vega?]

I have noticed that we often have trouble communciating, Michael. I
certainly never expressed a love for naked short stock. All I was
trying to point out is that while an exercised short put can easily be
turned into and maintained as a synthetic short put, your broker can
interfere with turning an exercised short call into a synthetic short
call; you may be forced to simply buy back the stock. The reason may
be that the broker has no shares in inventory to loan you to short so
it doesn't make any difference whether or not it may increase your
risk; you just can't have a position with the particular stock short,
as a synthetic short call would require.

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