NEUTRAL CALENDAR SPREAD	COVERED CALL
About Strategy	Neutral Calendar Spread Option strategy  This strategy is implemented if the trader is neutral in the near future for say 2 months or so. This strategy involves writing of Near Month 1 ATM Call Option and buying 1 Mid Month ATM Call Option, hence reducing the cost of purchase, with the same strike price of the same underlying asset. This strategy is used when the trader wants to make money from the Read more..	Covered Call Option Strategy Mr. X owns Reliance Shares and expects the price to rise in the near future. Mr. X is entitled to receive dividends for the shares he hold in cash market. Covered Call Strategy involves selling of OTM Call Option of the same underlying asset. The OTM Call Option Strike Price will generally be the price, where Mr. X will look to get out o .. Read more..

NEUTRAL CALENDAR SPREAD Vs COVERED CALL - Details

	NEUTRAL CALENDAR SPREAD	COVERED CALL
Market View	Neutral	Bullish
Type (CE/PE)	CE (Call Option)	CE (Call Option)
Number Of Positions	2	2
Strategy Level	Beginners	Advance
Reward Profile	Limited	Limited
Risk Profile	Limited	Unlimited
Breakeven Point	-	Purchase Price of Underlying- Premium Received

NEUTRAL CALENDAR SPREAD Vs COVERED CALL - When & How to use ?

	NEUTRAL CALENDAR SPREAD	COVERED CALL
Market View	Neutral	Bullish
When to use?	This strategy is implemented if the trader is neutral in the near future for say 2 months or so. This strategy involves writing of Near Month 1 ATM Call Option and buying 1 Mid Month ATM Call Option.	An investor has a short term neutral view on the asset and for this reason holds the asset long and has a short position to generate income.
Action	Sell 1 Near-Term ATM Call, Buy 1 Long-Term ATM Call	(Buy Underlying) (Sell OTM Call Option)
Breakeven Point	-	Purchase Price of Underlying- Premium Received

NEUTRAL CALENDAR SPREAD Vs COVERED CALL - Risk & Reward

	NEUTRAL CALENDAR SPREAD	COVERED CALL
Maximum Profit Scenario	Maximum Profit Limited When underlying stock price remains unchanged on expiration of the near month options.	[Call Strike Price - Stock Price Paid] + Premium Received
Maximum Loss Scenario	It occurs when the stock price goes down and stays down until expiration of the longer term options.	Purchase Price of Underlying - Price of Underlying) + Premium Received
Risk	Limited	Unlimited
Reward	Limited	Limited

NEUTRAL CALENDAR SPREAD Vs COVERED CALL - Strategy Pros & Cons

	NEUTRAL CALENDAR SPREAD	COVERED CALL
Similar Strategies	Long Put Butterfly, Iron Butterfly	Bull Call Spread
Disadvantage	• Lower profitability • Must have enough experience.	• Unlimited risk, limited reward. • Inability to earn interest on the proceed used to buy the underlying stock.
Advantages	• Almost zero margin required. • Ability to profit from time decay, limited risk. • This strategy allows you to transform position into long position.	• Profit from option premium, rise in the underlying stock and dividends on the stock. • Allows you to generate income from your holding. • Profit when underlying stock price rise, move sideways or marginal fall.