Comparision (DIAGONAL BULL CALL SPREAD
VS BEAR CALL SPREAD)
Compare Strategies
DIAGONAL BULL CALL SPREAD
BEAR CALL SPREAD
About Strategy
Diagonal Bull Call Spread Option Strategy
This strategy is implemented by a trader when he is neutral – moderately bullish in the near-month contract and bullish in the mid-month contract. It involves sale of 1 Near-Month OTM Call Option and buying of 1 Mid Month ITM Call Option.
Bear Call Spread option trading strategy is used by a trader who is bearish in nature and expects the underlying asset to dip in the near future. This strategy includes buying of an ‘Out of the Money’ Call Option and selling one ‘In the Money’ Call Option of the same underlying asset and the same expiration date. When you write a call, you receive premium thereby r ..
DIAGONAL BULL CALL SPREAD Vs BEAR CALL SPREAD - Details
DIAGONAL BULL CALL SPREAD
BEAR CALL SPREAD
Market View
Bullish
Bearish
Type (CE/PE)
CE (Call Option)
CE (Call Option)
Number Of Positions
2
2
Strategy Level
Beginners
Beginners
Reward Profile
Limited
Limited
Risk Profile
Limited
Limited
Breakeven Point
Strike Price of Short Call + Net Premium Received
DIAGONAL BULL CALL SPREAD Vs BEAR CALL SPREAD - When & How to use ?
DIAGONAL BULL CALL SPREAD
BEAR CALL SPREAD
Market View
Bullish
Bearish
When to use?
This strategy is used when you are bearish in market view. The strategy minimizes your risk in the event of prime movements going against your expectations.
• Limited amount of profit. • Margin requirement, more commission charges.
Advantages
• This strategy takes advantage of time decay. • Investors can get profit in a flat market scenario. • Investors can earn options premium income with a lower degree of risk.