Stock and Option Strategies STRATEGY: EXAMPLE Protective Put Buy Stock 50 and Buy S50 Put 2 PAL) PROTECTIVE PUT Stock Price at Expiration 57 Long Stock PXL) L Th PAL Total PXL) 4 56 3 55 2 Stock Price 54 53 52 SI O 50 49 -3 48 47 STRATEGY: EXAMPLE Covered Write Buy Stock 50 and Sell S50 Call @ 3 COVERED WRITE PXL) 5 Short Call PAL Long Stock PAL) Total PAL) Stock Price at Expiration 53 4 3 32 2 51 1 50 0 Stock Price 49 45 50 55 -1 48 47 -2 -3 46 45