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Comparision (BEAR CALL SPREAD VS REVERSE IRON CONDOR)

 

Compare Strategies

  BEAR CALL SPREAD REVERSE IRON CONDOR
About Strategy

Bear Call Spread Option Strategy 

Bear Call Spread option trading strategy is used by a trader who is bearish in nature and expects the underlying asset to dip in the near future. This strategy includes buying of an ‘Out of the Money’ Call Option and selling one ‘In the Money’ Call Option of the same underlying asset and the same expiration date. When you write a call, you receive premium thereby r

Reverse Iron Condor Option Strategy

Reverse Iron Condor as the name suggests is the opposite of Iron Condors. In Reverse Iron Condor, a trader is bullish about volatility and expects the market to make a significant move in the near future in either direction. Here a trader will buy 1 OTM Call Option, sell 1 Deep OTM Call Option, buy 1 OTM Put Option, sell 1 Deep OTM Put Option. This strategy also ..

BEAR CALL SPREAD Vs REVERSE IRON CONDOR - Details

BEAR CALL SPREAD REVERSE IRON CONDOR
Market View Bearish Neutral
Type (CE/PE) CE (Call Option) CE (Call Option) + PE (Put Option)
Number Of Positions 2 4
Strategy Level Beginners Advance
Reward Profile Limited Limited
Risk Profile Limited Limited
Breakeven Point Strike Price of Short Call + Net Premium Received Upper Breakeven Point = Strike Price of Long Call + Net Premium Paid, Lower Breakeven Point = Strike Price of Long Put - Net Premium Paid

BEAR CALL SPREAD Vs REVERSE IRON CONDOR - When & How to use ?

BEAR CALL SPREAD REVERSE IRON CONDOR
Market View Bearish Neutral
When to use? This strategy is used when you are bearish in market view. The strategy minimizes your risk in the event of prime movements going against your expectations. In Reverse Iron Condor, a trader is bullish about volatility and expects the market to make a significant move in the near future in either direction
Action Buy OTM Call Option, Sell ITM Call Option Buy 1 OTM Put, Sell 1 OTM Put (Lower Strike), Buy 1 OTM Call, Sell 1 OTM Call (Higher Strike)
Breakeven Point Strike Price of Short Call + Net Premium Received Upper Breakeven Point = Strike Price of Long Call + Net Premium Paid, Lower Breakeven Point = Strike Price of Long Put - Net Premium Paid

BEAR CALL SPREAD Vs REVERSE IRON CONDOR - Risk & Reward

BEAR CALL SPREAD REVERSE IRON CONDOR
Maximum Profit Scenario Max Profit = Net Premium Received - Commissions Paid Strike Price of Short Call (or Long Put) - Strike Price of Long Call (or Short Put) - Net Premium Paid - Commissions Paid
Maximum Loss Scenario Maximum Loss = Long Call Strike Price - Short Call Strike Price - Net Premium Received Net Premium Paid + Commissions Paid
Risk Limited Limited
Reward Limited Limited

BEAR CALL SPREAD Vs REVERSE IRON CONDOR - Strategy Pros & Cons

BEAR CALL SPREAD REVERSE IRON CONDOR
Similar Strategies Bear Put Spread, Bull Call Spread Short Condor
Disadvantage • Limited amount of profit. • Margin requirement, more commission charges. • Potential loss is higher than gain. • Limited profit.
Advantages • This strategy takes advantage of time decay. • Investors can get profit in a flat market scenario. • Investors can earn options premium income with a lower degree of risk. • Able to profit whether stocks move in either direction up or down. • This strategy can be used by option traders who cannot use credit spreads. • Predictable maximum loss and profits.

BEAR CALL SPREAD

REVERSE IRON CONDOR