SHORT CALL	STRAP
About Strategy	Short Call Option Strategy A trader shorts or writes a Call Option when he feels that underlying stock price is likely to go down. Selling Call Option is a strategy preferred for experienced traders. However this strategy is very risky in nature. If the stock rallies on the upside, your risk becomes potentially unquantifiable and unlimited. If the strategy Read more..	Strap Option Strategy  Strap Strategy is similar to Long Straddle, the only difference is the quantity traded. A trader will buy two Call Options and one Put Options. In this strategy, a trader is very bullish on the market and volatility on upside but wants to hedge himself in case the stock doesn’t perform as per his expectations. This strategy will make more profits compared to long straddle sin .. Read more..

SHORT CALL Vs STRAP - Details

	SHORT CALL	STRAP
Market View	Bearish	Neutral
Type (CE/PE)	CE (Call Option)	CE (Call Option) + PE (Put Option)
Number Of Positions	1	3
Strategy Level	Advance	Beginners
Reward Profile	Limited	Profit Achieved When Price of Underlying > Strike Price of Calls/Puts + (Net Premium Paid/2) OR Price of Underlying < Strike Price of Calls/Puts - Net Premium Paid
Risk Profile	Unlimited	Max Loss Occurs When Price of Underlying = Strike Price of Calls/Puts
Breakeven Point	Strike Price of Short Call + Premium Received	Strike Price of Calls/Puts + (Net Premium Paid/2)

SHORT CALL Vs STRAP - When & How to use ?

	SHORT CALL	STRAP
Market View	Bearish	Neutral
When to use?	It is an aggressive strategy and involves huge risks. It should be used only in case where trader is certain about the bearish market view on the underlying.	This strategy is used when the investor is bullish on the stock and expects volatility in the near future.
Action	Sell or Write Call Option	Buy 2 ATM Call Option, Buy 1 ATM Put Option
Breakeven Point	Strike Price of Short Call + Premium Received	Strike Price of Calls/Puts + (Net Premium Paid/2)

SHORT CALL Vs STRAP - Risk & Reward

	SHORT CALL	STRAP
Maximum Profit Scenario	Max Profit = Premium Received	UNLIMITED
Maximum Loss Scenario	Loss Occurs When Price of Underlying > Strike Price of Short Call + Premium Received	Net Premium Paid
Risk	Unlimited	Limited
Reward	Limited	Unlimited

SHORT CALL Vs STRAP - Strategy Pros & Cons

	SHORT CALL	STRAP
Similar Strategies	Covered Put, Covered Calls	Strip, Short Put Ladder, Short Call Ladder
Disadvantage	• Unlimited risk to the upside underlying stocks. • Potential loss more than the premium collected.	• To generate profit, there should be significant change in share price. • Expensive strategy.
Advantages	• With the help of this strategy, traders can book profit from falling prices in the underlying asset. • Less investment, more profit. • Traders can book profit when underlying stock price fall, move sideways or rise by a small amount.	• Limited loss. • If share prices are moving then traders can book unlimited profit. • A trader can still book profit if the underlying falls substantially.