SYNTHETIC LONG CALL	THE COLLAR
About Strategy	Synthetic Long Call Option Strategy A trader is bullish in nature for short term, but also fearful about the downside risk associated with it. Here, a trader wants to hold an underlying asset either in physical form like in case of commodities or demat (electronic) form in case of stocks. But he is always exposed to downside risk and in order to mitigate his losses, Read more..	The Collar Option Strategy Collar Strategy is an extension to Covered Call Strategy. A trader, who is bullish in nature but has a very low risk appetite and wants to mitigate his risk will implement the Collar Strategy. Collar involves buying of stock in either Cash/Futures Market, buying an ATM Put Option & selling an OTM Call Option. The expiry dates of the op .. Read more..

SYNTHETIC LONG CALL Vs THE COLLAR - Details

	SYNTHETIC LONG CALL	THE COLLAR
Market View	Bullish	Bullish
Type (CE/PE)	CE (Call Option)	CE (Call Option) + PE (Put Option) + Underlying
Number Of Positions	2	3
Strategy Level	Beginners	Advance
Reward Profile	When Price of Underlying > Purchase Price of Underlying + Premium Paid	Limited
Risk Profile	Limited (Maximum loss happens when the price of instrument move above from the strike price of put)	Limited
Breakeven Point	Underlying Price + Put Premium	Price of Features - Call Premium + Put Premium

SYNTHETIC LONG CALL Vs THE COLLAR - When & How to use ?

	SYNTHETIC LONG CALL	THE COLLAR
Market View	Bullish	Bullish
When to use?	A trader is bullish in nature for short term, but also fearful about the downside risk associated with it.	It should be used only in case where trader is certain about the bearish market view.
Action	Buy 1 ATM Put or OTM Put	Buy Underlying, Buy 1 ATM Put Option, Sell 1 OTM Call Option
Breakeven Point	Underlying Price + Put Premium	Price of Features - Call Premium + Put Premium

SYNTHETIC LONG CALL Vs THE COLLAR - Risk & Reward

	SYNTHETIC LONG CALL	THE COLLAR
Maximum Profit Scenario	Current Price - Purchase Price - Premium Paid	Strike Price of Short Call - Purchase Price of Underlying + Net Premium Received
Maximum Loss Scenario	Premium Paid	Purchase Price of Underlying - Strike Price of Long Put - Net Premium Received
Risk	Limited	Limited
Reward	Unlimited	Limited

SYNTHETIC LONG CALL Vs THE COLLAR - Strategy Pros & Cons

	SYNTHETIC LONG CALL	THE COLLAR
Similar Strategies	Protective Put, Long Call	Call Spread, Bull Put Spread
Disadvantage	•Chances of loss if the underlying goes down. •Incur losses if option is exercised.	• Limited profit. • A trader can book more profit without this strategy if the prices goes high.
Advantages	•Limited risk, unlimited profit. •Protection to your long-term holdings. • Limited loss to the to the premium paid for Put option.	• This strategy protects the losses on underlying asset. • Risk gets limited if the price of the stocks goes down. • Trader can get ownership benefits life dividend and voting rights.