Compare Strategies
LONG CALL CONDOR SPREAD | SHORT CALL | |
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About Strategy |
Long Call Condor Spread Option StrategyThis strategy is implemented when a trader is bearish on the volatility and expects the market to move sideways. Using Call Options of the same expiry date, he will buy one Deep ITM Call Option, sell 1 ITM Call Option, sell 1 OTM Call Option, buy 1 Deep OTM Call Option. The risk and reward both are limited due to offsetting of long and short positions. For t |
Short Call Option StrategyA trader shorts or writes a Call Option when he feels that underlying stock price is likely to go down. Selling Call Option is a strategy preferred for experienced traders. However this strategy is very risky in nature. If the stock rallies on the upside, your risk becomes potentially unquantifiable and unlimited. If the strategy .. |
LONG CALL CONDOR SPREAD Vs SHORT CALL - Details
LONG CALL CONDOR SPREAD | SHORT CALL | |
---|---|---|
Market View | Neutral | Bearish |
Type (CE/PE) | CE (Call Option) | CE (Call Option) |
Number Of Positions | 4 | 1 |
Strategy Level | Advance | Advance |
Reward Profile | Limited | Limited |
Risk Profile | Limited | Unlimited |
Breakeven Point | Lower Breakeven = Lower Strike Price + Net Premium Upper breakeven = Higher Strike Price - Net Premium | Strike Price of Short Call + Premium Received |
LONG CALL CONDOR SPREAD Vs SHORT CALL - When & How to use ?
LONG CALL CONDOR SPREAD | SHORT CALL | |
---|---|---|
Market View | Neutral | Bearish |
When to use? | This strategy works well when you expect the price of the underlying asset to be range bound in the coming days. | It is an aggressive strategy and involves huge risks. It should be used only in case where trader is certain about the bearish market view on the underlying. |
Action | Buy Deep ITM Call Option, Buy Deep OTM Call Option, Sell ITM Call Option, Sell OTM Call Option | Sell or Write Call Option |
Breakeven Point | Lower Breakeven = Lower Strike Price + Net Premium Upper breakeven = Higher Strike Price - Net Premium | Strike Price of Short Call + Premium Received |
LONG CALL CONDOR SPREAD Vs SHORT CALL - Risk & Reward
LONG CALL CONDOR SPREAD | SHORT CALL | |
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Maximum Profit Scenario | Strike Price of Lower Strike Short Call - Strike Price of Lower Strike Long Call - Net Premium Paid | Max Profit = Premium Received |
Maximum Loss Scenario | Net Premium Paid | Loss Occurs When Price of Underlying > Strike Price of Short Call + Premium Received |
Risk | Limited | Unlimited |
Reward | Limited | Limited |
LONG CALL CONDOR SPREAD Vs SHORT CALL - Strategy Pros & Cons
LONG CALL CONDOR SPREAD | SHORT CALL | |
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Similar Strategies | Long Put Butterfly, Short Call Condor, Short Strangle | Covered Put, Covered Calls |
Disadvantage | • Amount of profit is comparatively low. • As this strategy has 4 legs so the brokerage cost is higher that will affect your profit. | • Unlimited risk to the upside underlying stocks. • Potential loss more than the premium collected. |
Advantages | • Capable to generate profit even if there is low volatility in the market. • This strategy is associated with limited risk and limited profit. • Wider profit zone. | • With the help of this strategy, traders can book profit from falling prices in the underlying asset. • Less investment, more profit. • Traders can book profit when underlying stock price fall, move sideways or rise by a small amount. |