PROTECTIVE PUT	LONG CALL
About Strategy	Protective Put Option Strategy Protective Put Strategy is a hedging strategy where trader guards himself from the downside risk. This strategy is adopted when a trader is long on the underlying asset but skeptical of the downside. He will buy one ATM Put Option to hedge his position. Now, if the underlying asset moves either up or down, the trader is in a safe position. Read more..	Long Call Option Strategy This is one of the basic strategies as it involves entering into one position i.e. buying the Call Option only. Any investor who buys the Call Option will be bullish in nature and would be expecting the market to give decent returns in the near future. Risk: Read more..

PROTECTIVE PUT Vs LONG CALL - Details

	PROTECTIVE PUT	LONG CALL
Market View	Bullish	Bullish
Type (CE/PE)	PE (Put Option)	CE (Call Option)
Number Of Positions	1	1
Strategy Level	Beginners	Beginner Level
Reward Profile	Unlimited	Unlimited
Risk Profile	Limited	Limited
Breakeven Point	Purchase Price of Underlying + Premium Paid	Strike Price + Premium

PROTECTIVE PUT Vs LONG CALL - When & How to use ?

	PROTECTIVE PUT	LONG CALL
Market View	Bullish	Bullish (Any investor who buys the Call Option will be bullish in nature and would be expecting the market to give decent returns in the near future.)
When to use?	This strategy is adopted when a trader is long on the underlying asset but skeptical of the downside.	This strategy work when an investor expect the underlying instrument move in upward direction.
Action	Buy 1 ATM Put	Buying Call option
Breakeven Point	Purchase Price of Underlying + Premium Paid	Strike price + Premium

PROTECTIVE PUT Vs LONG CALL - Risk & Reward

	PROTECTIVE PUT	LONG CALL
Maximum Profit Scenario	Price of Underlying - Purchase Price of Underlying - Premium Paid	Underlying Asset close above from the strike price on expiry.
Maximum Loss Scenario	Premium Paid + Purchase Price of Underlying - Put Strike + Commissions Paid	Premium Paid
Risk	Limited	Limited
Reward	Unlimited	Unlimited

PROTECTIVE PUT Vs LONG CALL - Strategy Pros & Cons

	PROTECTIVE PUT	LONG CALL
Similar Strategies	Long Call, Call Backspread	Protective Put
Disadvantage	• Value of protective put position decreases as time passes • Holding period of the protective put can be affected by the timing as a result tax rate on the profit or loss from the stock can be affected.	• In this strategy, there is not protection against the underlying stock falling in value. • 100% loss if the strike price, expiration dates or underlying stocks are badly chosen.
Advantages	• Unlimited potential profit due to indefinitely rise in the underlying stock price . • This strategy allows you to hold on to your stocks while insuring against losses. • Hedging strategy, trader can guard himself from the downside risk.	• Less investment, more profit. • Unlimited profit with limited risk. • High leverage than simply owning the stock.