Compare Strategies
| DIAGONAL BEAR PUT SPREAD | SHORT CALL CONDOR SPREAD | |
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| About Strategy |
Diagonal Bear Put SpreadWhen the trader is neutral – bearish in the near-month and bearish in the mid-month, he will apply Diagonal Bear Put Spread. This strategy involves buying Mid-Month ITM Put Options and selling (short/write) equal number of Near-Month OTM Put Options, of the same underlying asset. This strategy bags limited rewards with limited risk. |
Short Call Condor Spread Option StrategyShort Call Condor Spread is the opposite of Long Call Condor Spread i.e. sell 1 Deep ITM Call Option, buy 1 ITM Call Option, buy 1 OTM Call Option, sell 1 Deep OTM Call Option. Similar to Long Call Condor, the risk and rewards associated with this strategy are limited. Credit is received at the time of entering into this strategy. |
DIAGONAL BEAR PUT SPREAD Vs SHORT CALL CONDOR SPREAD - Details
| DIAGONAL BEAR PUT SPREAD | SHORT CALL CONDOR SPREAD | |
|---|---|---|
| Market View | Bearish | Volatile |
| Type (CE/PE) | PE (Put Option) | CE (Call Option) |
| Number Of Positions | 2 | 4 |
| Strategy Level | Beginners | Advance |
| Reward Profile | Limited | Limited |
| Risk Profile | Limited | Limited |
| Breakeven Point | This is a dynamic trade with many possible scenarios and future trades, it is impossible to calculate a breakeven. | Lower Breakeven = Lower Strike Price + Net Premium, Upper breakeven = Higher Strike Price - Net Premium |
DIAGONAL BEAR PUT SPREAD Vs SHORT CALL CONDOR SPREAD - When & How to use ?
| DIAGONAL BEAR PUT SPREAD | SHORT CALL CONDOR SPREAD | |
|---|---|---|
| Market View | Bearish | Volatile |
| When to use? | When the trader is neutral – bearish in the near-month and bearish in the mid-month, he will apply Diagonal Bear Put Spread. This strategy involves buying Mid-Month ITM Put Options and selling (short/write) equal number of Near-Month OTM Put Options, of the same underlying asset | This strategy is used when an investor expect the price of the underlying stock to be very volatile. |
| Action | Sell 1 Near-Month OTM Put Option, Buy 1 Mid-Month ITM Put Option | Buy ITM Call Option + Buy OTM Call Option + Sell Deep OTM Call Option + Sell Deep ITM Call Option |
| Breakeven Point | This is a dynamic trade with many possible scenarios and future trades, it is impossible to calculate a breakeven. | Lower Breakeven = Lower Strike Price + Net Premium, Upper breakeven = Higher Strike Price - Net Premium |
DIAGONAL BEAR PUT SPREAD Vs SHORT CALL CONDOR SPREAD - Risk & Reward
| DIAGONAL BEAR PUT SPREAD | SHORT CALL CONDOR SPREAD | |
|---|---|---|
| Maximum Profit Scenario | 'Premiums received - Initial premium to execute + Strike price - Stock Price on final month | Strike Price of Lower Strike Short Call - Strike Price of Lower Strike Long Call - Net Premium Paid |
| Maximum Loss Scenario | When the stock trades up above the long-term put strike price. | Strike Price of Lower Strike Long Call - Strike Price of Lower Strike Short Call - Net Premium Received + Commissions Paid |
| Risk | Limited | Limited |
| Reward | Limited | Limited |
DIAGONAL BEAR PUT SPREAD Vs SHORT CALL CONDOR SPREAD - Strategy Pros & Cons
| DIAGONAL BEAR PUT SPREAD | SHORT CALL CONDOR SPREAD | |
|---|---|---|
| Similar Strategies | Bear Put Spread and Bear Call Spread | Short Strangle |
| Disadvantage | Higher commissions due to additional trades. , Changes maximum profit potential of call or put spreads. | • Amount of profit is low in comparison with other strategies. • As this strategy has 4 legs so the brokerage cost is higher that will affect your profit. |
| Advantages | The Risk is limited. | • This strategy allows you to profit from highly volatile underlying assets moving in any direction. • Earn profit with little or no investment. • Wider profit zone. |