COVERED PUT	SYNTHETIC LONG CALL
About Strategy	Covered Put Option Strategy  This strategy is exactly opposite to Covered Call Strategy. Here the investor is neutral or moderately bearish in nature and wants to take advantage of the price fall in the near future. The trader will short one lot of stock future. Now the trader will short ATM Put Option, the option strike price will be his exit price. If the prices rally above the strike price, the 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 PUT Vs SYNTHETIC LONG CALL - Details

	COVERED PUT	SYNTHETIC LONG CALL
Market View	Bearish	Bullish
Type (CE/PE)	PE (Put Option) + Underlying	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	Futures Price + Premium Received	Underlying Price + Put Premium

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

	COVERED PUT	SYNTHETIC LONG CALL
Market View	Bearish	Bullish
When to use?	The Covered Put works well when the market is moderately Bearish.	A trader is bullish in nature for short term, but also fearful about the downside risk associated with it.
Action	Sell Underlying Sell OTM Put Option	Buy 1 ATM Put or OTM Put
Breakeven Point	Futures Price + Premium Received	Underlying Price + Put Premium

COVERED PUT Vs SYNTHETIC LONG CALL - Risk & Reward

	COVERED PUT	SYNTHETIC LONG CALL
Maximum Profit Scenario	The profit happens when the price of the underlying moves above strike price of Short Put.	Current Price - Purchase Price - Premium Paid
Maximum Loss Scenario	Price of Underlying - Sale Price of Underlying - Premium Received	Premium Paid
Risk	Unlimited	Limited
Reward	Limited	Unlimited

COVERED PUT Vs SYNTHETIC LONG CALL - Strategy Pros & Cons

	COVERED PUT	SYNTHETIC LONG CALL
Similar Strategies	Bear Put Spread, Bear Call Spread	Protective Put, Long Call
Disadvantage	• Limited profit, unlimited risk. • Trader should have enough experience before using this strategy.	•Chances of loss if the underlying goes down. •Incur losses if option is exercised.
Advantages	• Investors can book profit when underlying stock price drop, move sideways or rises by a small amount. • Able to generate monthly income. • Able to generate profit from fall in prices or mild increase in the prices.	•Limited risk, unlimited profit. •Protection to your long-term holdings. • Limited loss to the to the premium paid for Put option.