STOCK BROKER REVIEW | INVESTING | UPCOMING IPO | ALGO TRADING | TECHNICAL ANALYSIS

Comparision (DIAGONAL BULL CALL SPREAD VS CHRISTMAS TREE SPREAD WITH PUT OPTION)

 

Compare Strategies

  DIAGONAL BULL CALL SPREAD CHRISTMAS TREE SPREAD WITH PUT OPTION
About Strategy

Diagonal Bull Call Spread Option Strategy

This strategy is implemented by a trader when he is neutral – moderately bullish in the near-month contract and bullish in the mid-month contract. It involves sale of 1 Near-Month OTM Call Option and buying of 1 Mid Month ITM Call Option.

Christmas Tree Spread with Puts Option Strategy

This Strategy is an advance option strategy that consists of three legs and six total options. In this strategy buying one put at strike price D, skipping strike price C, writes three calls at strike price B, and buying two calls at strike price A for same expiration dates for neutral to bearish forecast. An investor used this strategy to potential returns ..

DIAGONAL BULL CALL SPREAD Vs CHRISTMAS TREE SPREAD WITH PUT OPTION - Details

DIAGONAL BULL CALL SPREAD CHRISTMAS TREE SPREAD WITH PUT OPTION
Market View Bullish Bearish
Type (CE/PE) CE (Call Option) CE (Call Option)
Number Of Positions 2 6
Strategy Level Beginners Advance
Reward Profile Limited Limited
Risk Profile Limited Limited
Breakeven Point Lowest strike prices + the half premium – premium paid

DIAGONAL BULL CALL SPREAD Vs CHRISTMAS TREE SPREAD WITH PUT OPTION - When & How to use ?

DIAGONAL BULL CALL SPREAD CHRISTMAS TREE SPREAD WITH PUT OPTION
Market View Bullish Bearish
When to use? This Strategy is used when an investor wants potential returns.
Action Buy 1 Long-Term ITM Call Sell 1 Near-Term OTM Call Buying one ATM, Selling 3 Puts, Buying one more OTM Put
Breakeven Point Lowest strike prices + the half premium – premium paid

DIAGONAL BULL CALL SPREAD Vs CHRISTMAS TREE SPREAD WITH PUT OPTION - Risk & Reward

DIAGONAL BULL CALL SPREAD CHRISTMAS TREE SPREAD WITH PUT OPTION
Maximum Profit Scenario Equal middle strike price – higher strike price – the premium
Maximum Loss Scenario Net Debit paid for the strategy.
Risk Limited Limited
Reward Limited Limited

DIAGONAL BULL CALL SPREAD Vs CHRISTMAS TREE SPREAD WITH PUT OPTION - Strategy Pros & Cons

DIAGONAL BULL CALL SPREAD CHRISTMAS TREE SPREAD WITH PUT OPTION
Similar Strategies Bull Put Spread Butterfly spreads
Disadvantage • Potential profit is lower or limited.
Advantages • The potential of loss is limited.

DIAGONAL BULL CALL SPREAD

CHRISTMAS TREE SPREAD WITH PUT OPTION