LONG COMBO	RATIO CALL SPREAD
About Strategy	Long Combo Option Strategy  Long Combo Option Trading Strategy is implemented when a trader is bullish in nature and expects the stock price to rise in the near future. Here a trader will sell one ‘Out of the Money’ Put Option and buy one ‘Out of the Money’ Call Option. This trade will require less capital to implement since the amount required to buy the call will be covered by the amount received 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..

LONG COMBO Vs RATIO CALL SPREAD - Details

	LONG COMBO	RATIO CALL SPREAD
Market View	Bullish	Neutral
Type (CE/PE)	CE (Call Option) + PE (Put Option)	CE (Call Option)
Number Of Positions	2	3
Strategy Level	Advance	Beginners
Reward Profile	Unlimited	Limited
Risk Profile	Unlimited	Unlimited
Breakeven Point	Call Strike + Net Premium	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

LONG COMBO Vs RATIO CALL SPREAD - When & How to use ?

	LONG COMBO	RATIO CALL SPREAD
Market View	Bullish	Neutral
When to use?	This strategy is used when an investor Bullish on an underlying but don't have the required capital or the risk appetite to invest directly into it.	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 OTM Put Option, Buy OTM Call Option	Buy 1 ITM Call, Sell 2 OTM Calls
Breakeven Point	Call Strike + Net Premium	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

LONG COMBO Vs RATIO CALL SPREAD - Risk & Reward

	LONG COMBO	RATIO CALL SPREAD
Maximum Profit Scenario	Underlying asset goes up and Call option exercised	Strike Price of Short Call - Strike Price of Long Call + Net Premium Received - Commissions Paid
Maximum Loss Scenario	Underlying asset goes down and Put option exercised	Price of Underlying - Strike Price of Short Calls - Max Profit + Commissions Paid
Risk	Unlimited	Unlimited
Reward	Unlimited	Limited

LONG COMBO Vs RATIO CALL SPREAD - Strategy Pros & Cons

	LONG COMBO	RATIO CALL SPREAD
Similar Strategies	-	Variable Ratio Write
Disadvantage	• Losses can keep on increasing as the price of stock goes down. • High risk strategy.	• Unlimited potential loss. • Complex strategy with limited profit.
Advantages	• Capital investment is low and returns are high. • Unlimited reward, returns keep on increasing with the increase on stock price. • Leverage facility provided by this strategy is very beneficial.	• 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.