Compare Strategies
LONG CALL LADDER | LONG CALL LADDER | |
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About Strategy |
Long Call Ladder Option StrategyLong Call Ladder Strategy is an extension to Bull Call Spread Strategy. A trader will be slightly bullish about the market, in this strategy but bearish over volatility. It involves buying of an ITM Call Option and sale of 1 ATM & 1 OTM Call Options. However, the risk associated with this strategy is unlimited and reward is limited. |
Long Call Ladder Option StrategyLong Call Ladder Strategy is an extension to Bull Call Spread Strategy. A trader will be slightly bullish about the market, in this strategy but bearish over volatility. It involves buying of an ITM Call Option and sale of 1 ATM & 1 OTM Call Options. However, the risk associated with this strategy is unlimited and reward is limited. |
LONG CALL LADDER Vs LONG CALL LADDER - Details
LONG CALL LADDER | LONG CALL LADDER | |
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Market View | Neutral | Neutral |
Type (CE/PE) | CE (Call Option) | CE (Call Option) |
Number Of Positions | 3 | 3 |
Strategy Level | Advance | Advance |
Reward Profile | Unlimited | Unlimited |
Risk Profile | Unlimited | Unlimited |
Breakeven Point | Upper Breakeven Point = Total Strike Prices of Short Calls - Strike Price of Long Call - Net Premium Paid, Lower Breakeven Point = Strike Price of Long Call + Net Premium Paid | Upper Breakeven Point = Total Strike Prices of Short Calls - Strike Price of Long Call - Net Premium Paid, Lower Breakeven Point = Strike Price of Long Call + Net Premium Paid |
LONG CALL LADDER Vs LONG CALL LADDER - When & How to use ?
LONG CALL LADDER | LONG CALL LADDER | |
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Market View | Neutral | Neutral |
When to use? | This Strategy is an extension to Bull Call Spread Strategy. A trader will be slightly bullish about the market, in this strategy but bearish over volatility. | This Strategy is an extension to Bull Call Spread Strategy. A trader will be slightly bullish about the market, in this strategy but bearish over volatility. |
Action | Buy 1 ITM Call, Sell 1 ATM Call, Sell 1 OTM Call | Buy 1 ITM Call, Sell 1 ATM Call, Sell 1 OTM Call |
Breakeven Point | Upper Breakeven Point = Total Strike Prices of Short Calls - Strike Price of Long Call - Net Premium Paid, Lower Breakeven Point = Strike Price of Long Call + Net Premium Paid | Upper Breakeven Point = Total Strike Prices of Short Calls - Strike Price of Long Call - Net Premium Paid, Lower Breakeven Point = Strike Price of Long Call + Net Premium Paid |
LONG CALL LADDER Vs LONG CALL LADDER - Risk & Reward
LONG CALL LADDER | LONG CALL LADDER | |
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Maximum Profit Scenario | Strike Price of Lower Strike Short Call - Strike Price of Long Call - Net Premium Paid - Commissions Paid | Strike Price of Lower Strike Short Call - Strike Price of Long Call - Net Premium Paid - Commissions Paid |
Maximum Loss Scenario | Price of Underlying - Upper Breakeven Price + Commissions Paid | Price of Underlying - Upper Breakeven Price + Commissions Paid |
Risk | Unlimited | Unlimited |
Reward | Unlimited | Unlimited |
LONG CALL LADDER Vs LONG CALL LADDER - Strategy Pros & Cons
LONG CALL LADDER | LONG CALL LADDER | |
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Similar Strategies | Short Strangle (Sell Strangle), Short Straddle (Sell Straddle) | Short Strangle (Sell Strangle), Short Straddle (Sell Straddle) |
Disadvantage | • Unlimited risk. • Margin required. | • Unlimited risk. • Margin required. |
Advantages | • Reduces capital outlay of bull call spread. • Wider maximum profit zone. • When there is decrease in implied volatility, this strategy can give profit. | • Reduces capital outlay of bull call spread. • Wider maximum profit zone. • When there is decrease in implied volatility, this strategy can give profit. |