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3 Responses
Dan: I really liked this video and greatly appreciate your analysis. However, I would add anothe factor: Unseen or random events that make stocks move much more than expected – tail risk or some sort. This might be a market-wide move or a stock-specific move. If the time-span of the crdit spread is larger, such moves might be overcome – for expample – a 45-60 Days to Expiration credit spread might overcome such tail risk much more than a 30-days to expiry. Thanks. Ahmad Mohammad
Hey Ahmad. Yep. You’re right. that’s why management is so important.
The biggest problem is being able to analyze all of this and if a Call spread, watch the stock fall or on the PUT spread, watch it rise and getting it on. We lose the hedge. U see this too….there is no answer…