CALL BACKSPREAD	RATIO CALL SPREAD
About Strategy	Call Backspread Option Trading  This strategy is adopted by traders who are bullish in nature. He expects market and volatility to rise in the near future. A trader need not be direction specific here (i.e. an upward or downward trend, but a small bias towards an uptrend should always be present, as the gains will be much higher once the market moves up r Read more..	Ratio Call Spread Option Strategy  As the name suggests, a ratio of 2:1 is followed i.e. buy 1 ITM Call and simultaneously sell OTM Calls double the number of ITM Calls (In this case 2). This strategy is used by trader who is neutral on the market and bearish on the volatility in the near future. Here profits will be capped up to the premium amount and risk will be potentially unlimited since he is .. Read more..

CALL BACKSPREAD Vs RATIO CALL SPREAD - Details

	CALL BACKSPREAD	RATIO CALL SPREAD
Market View	Bullish	Neutral
Type (CE/PE)	CE (Call Option)	CE (Call Option)
Number Of Positions	3	3
Strategy Level	Advance	Beginners
Reward Profile	Unlimited	Limited
Risk Profile	Limited	Unlimited
Breakeven Point	Lower breakeven = strike price of the short call, Upper breakeven = strike price of long calls + point of maximum loss	Upper Breakeven Point = Strike Price of Short Calls + (Points of Maximum Profit / Number of Uncovered Calls), Lower Breakeven Point = Strike Price of Long Call +/- Net Premium Paid or Received

CALL BACKSPREAD Vs RATIO CALL SPREAD - When & How to use ?

	CALL BACKSPREAD	RATIO CALL SPREAD
Market View	Bullish	Neutral
When to use?	This strategy is used when the investor expects the price of the stock to rise in the future.	This strategy is used by trader who is neutral on the market and bearish on the volatility in the near future. Here profits will be capped up to the premium amount and risk will be potentially unlimited since he is selling two calls.
Action	Sell 1 ITM Call, BUY 2 OTM Call	Buy 1 ITM Call, Sell 2 OTM Calls
Breakeven Point	Lower breakeven = strike price of the short call, Upper breakeven = strike price of long calls + point of maximum loss	Upper Breakeven Point = Strike Price of Short Calls + (Points of Maximum Profit / Number of Uncovered Calls), Lower Breakeven Point = Strike Price of Long Call +/- Net Premium Paid or Received

CALL BACKSPREAD Vs RATIO CALL SPREAD - Risk & Reward

	CALL BACKSPREAD	RATIO CALL SPREAD
Maximum Profit Scenario	Unlimited profit potential if the stock goes in upward direction.	Strike Price of Short Call - Strike Price of Long Call + Net Premium Received - Commissions Paid
Maximum Loss Scenario	Strike Price of long call - Strike Price of short call - Net premium received	Price of Underlying - Strike Price of Short Calls - Max Profit + Commissions Paid
Risk	Limited	Unlimited
Reward	Unlimited	Limited

CALL BACKSPREAD Vs RATIO CALL SPREAD - Strategy Pros & Cons

	CALL BACKSPREAD	RATIO CALL SPREAD
Similar Strategies	-	Variable Ratio Write
Disadvantage		• Unlimited potential loss. • Complex strategy with limited profit.
Advantages	• Unlimited profit potential.	• Downside risk is almost zero. • Investors can book profit from share prices moving within given limits. • Trader can maximise profit when the share closes at the upper breakeven point.