COVERED COMBINATION	SYNTHETIC LONG CALL
About Strategy	Covered Combination Option Strategy This strategy involves selling OTM Call & Put Options and buying the underlying asset in either cash or futures market. It is also known as Covered Strangle as the profits are capped and risk is potentially unlimited. Risk: Un Read more..	Synthetic Long Call Option Strategy A trader is bullish in nature for short term, but also fearful about the downside risk associated with it. Here, a trader wants to hold an underlying asset either in physical form like in case of commodities or demat (electronic) form in case of stocks. But he is always exposed to downside risk and in order to mitigate his losses, .. Read more..

COVERED COMBINATION Vs SYNTHETIC LONG CALL - Details

	COVERED COMBINATION	SYNTHETIC LONG CALL
Market View	Bullish	Bullish
Type (CE/PE)	CE (Call Option) + PE (Put Option)	CE (Call Option)
Number Of Positions	2	2
Strategy Level	Advance	Beginners
Reward Profile	Limited	When Price of Underlying > Purchase Price of Underlying + Premium Paid
Risk Profile	Unlimited	Limited (Maximum loss happens when the price of instrument move above from the strike price of put)
Breakeven Point	(Purchase Price of Underlying + Strike Price of Short Put - Net Premium Received) / 2	Underlying Price + Put Premium

COVERED COMBINATION Vs SYNTHETIC LONG CALL - When & How to use ?

	COVERED COMBINATION	SYNTHETIC LONG CALL
Market View	Bullish	Bullish
When to use?	This strategy is mainly suited for investors who are moderately bullish on a stock and are comfortable with increasing their position in the event of a price decline.	A trader is bullish in nature for short term, but also fearful about the downside risk associated with it.
Action	Sell 1 OTM Call, Sell 1 OTM Put	Buy 1 ATM Put or OTM Put
Breakeven Point	(Purchase Price of Underlying + Strike Price of Short Put - Net Premium Received) / 2	Underlying Price + Put Premium

COVERED COMBINATION Vs SYNTHETIC LONG CALL - Risk & Reward

	COVERED COMBINATION	SYNTHETIC LONG CALL
Maximum Profit Scenario	Strike Price of Short Call - Purchase Price of Underlying + Net Premium Received - Commissions Paid	Current Price - Purchase Price - Premium Paid
Maximum Loss Scenario	Purchase Price of Underlying + Strike Price of Short Put - (2 x Price of Underlying) - Max Profit + Commissions Paid	Premium Paid
Risk	Unlimited	Limited
Reward	Limited	Unlimited

COVERED COMBINATION Vs SYNTHETIC LONG CALL - Strategy Pros & Cons

	COVERED COMBINATION	SYNTHETIC LONG CALL
Similar Strategies	Stock Repair Strategy	Protective Put, Long Call
Disadvantage	Combinations can be profitable in sideways or rising markets. Greater combined net credit increases downside protection and potential return.	•Chances of loss if the underlying goes down. •Incur losses if option is exercised.
Advantages	Limited Maximum Profit on the upside. Covered Combinations should only be traded on stocks that are bullish.	•Limited risk, unlimited profit. •Protection to your long-term holdings. • Limited loss to the to the premium paid for Put option.