Quote from _mas:
MTE: So how do you leg in?
I just read this strategy at a website today, and thought it was too good to be true.
So which strategy gives the best risk vs reward?
Legging in means buying/selling components at different times. For example, you may buy the stock and put and then wait for the stock to rise enough so that you can sell the call for more than you paid for the put. However, in doing so you assume directional risk - i.e. the risk that the stock doesn't rise and you won't be able to get enough money for the call to cover the put purchase.
Just a hint, when something sounds like too good to be true, it is.
Which strategy gives the best risk/reward? A long call. You risk is limited to the premium paid and your potential profit is unlimited. But I guess it is not what you're looking for.