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Comparision (LONG CALL LADDER VS SHORT CALL CONDOR SPREAD)

 

Compare Strategies

  LONG CALL LADDER SHORT CALL CONDOR SPREAD
About Strategy

Long Call Ladder Option Strategy 

Long Call Ladder Strategy is an extension to Bull Call Spread Strategy. A trader will be slightly bullish about the market, in this strategy but bearish over volatility. It involves buying of an ITM Call Option and sale of 1 ATM & 1 OTM Call Options. However, the risk associated with this strategy is unlimited and reward is limited.

Short Call Condor Spread Option Strategy

Short Call Condor Spread is the opposite of Long Call Condor Spread i.e. sell 1 Deep ITM Call Option, buy 1 ITM Call Option, buy 1 OTM Call Option, sell 1 Deep OTM Call Option. Similar to Long Call Condor, the risk and rewards associated with this strategy are limited. Credit is received at the time of entering into this strategy.

LONG CALL LADDER Vs SHORT CALL CONDOR SPREAD - Details

LONG CALL LADDER SHORT CALL CONDOR SPREAD
Market View Neutral Volatile
Type (CE/PE) CE (Call Option) CE (Call Option)
Number Of Positions 3 4
Strategy Level Advance Advance
Reward Profile Unlimited Limited
Risk Profile Unlimited Limited
Breakeven Point Upper Breakeven Point = Total Strike Prices of Short Calls - Strike Price of Long Call - Net Premium Paid, Lower Breakeven Point = Strike Price of Long Call + Net Premium Paid Lower Breakeven = Lower Strike Price + Net Premium, Upper breakeven = Higher Strike Price - Net Premium

LONG CALL LADDER Vs SHORT CALL CONDOR SPREAD - When & How to use ?

LONG CALL LADDER SHORT CALL CONDOR SPREAD
Market View Neutral Volatile
When to use? This Strategy is an extension to Bull Call Spread Strategy. A trader will be slightly bullish about the market, in this strategy but bearish over volatility. This strategy is used when an investor expect the price of the underlying stock to be very volatile.
Action Buy 1 ITM Call, Sell 1 ATM Call, Sell 1 OTM Call Buy ITM Call Option + Buy OTM Call Option + Sell Deep OTM Call Option + Sell Deep ITM Call Option
Breakeven Point Upper Breakeven Point = Total Strike Prices of Short Calls - Strike Price of Long Call - Net Premium Paid, Lower Breakeven Point = Strike Price of Long Call + Net Premium Paid Lower Breakeven = Lower Strike Price + Net Premium, Upper breakeven = Higher Strike Price - Net Premium

LONG CALL LADDER Vs SHORT CALL CONDOR SPREAD - Risk & Reward

LONG CALL LADDER SHORT CALL CONDOR SPREAD
Maximum Profit Scenario Strike Price of Lower Strike Short Call - Strike Price of Long Call - Net Premium Paid - Commissions Paid Strike Price of Lower Strike Short Call - Strike Price of Lower Strike Long Call - Net Premium Paid
Maximum Loss Scenario Price of Underlying - Upper Breakeven Price + Commissions Paid Strike Price of Lower Strike Long Call - Strike Price of Lower Strike Short Call - Net Premium Received + Commissions Paid
Risk Unlimited Limited
Reward Unlimited Limited

LONG CALL LADDER Vs SHORT CALL CONDOR SPREAD - Strategy Pros & Cons

LONG CALL LADDER SHORT CALL CONDOR SPREAD
Similar Strategies Short Strangle (Sell Strangle), Short Straddle (Sell Straddle) Short Strangle
Disadvantage • Unlimited risk. • Margin required. • Amount of profit is low in comparison with other strategies. • As this strategy has 4 legs so the brokerage cost is higher that will affect your profit.
Advantages • Reduces capital outlay of bull call spread. • Wider maximum profit zone. • When there is decrease in implied volatility, this strategy can give profit. • This strategy allows you to profit from highly volatile underlying assets moving in any direction. • Earn profit with little or no investment. • Wider profit zone.

LONG CALL LADDER

SHORT CALL CONDOR SPREAD