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Comparision (BEAR CALL SPREAD VS IRON CONDORS)

 

Compare Strategies

  BEAR CALL SPREAD IRON CONDORS
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

Iron Condors Option Strategy

Iron Condor is a neutral trading strategy. A trader tries to make profit from low volatility in the price of the underlying asset. This strategy will be better understood if you recall ‘Bull Put Spread’ & ‘Bear Call Spread’. A trader will buy one Deep OTM Put Option and sell one OTM Put Option,. He will also sell one OTM Call Option and buy one Deep OTM Call Option. ..

BEAR CALL SPREAD Vs IRON CONDORS - Details

BEAR CALL SPREAD IRON CONDORS
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 Short Call + Net Premium Received, Lower Breakeven Point = Strike Price of Short Put - Net Premium Received

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

BEAR CALL SPREAD IRON CONDORS
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. When a trader tries to make profit from low volatility in the price of the underlying asset.
Action Buy OTM Call Option, Sell ITM Call Option Sell 1 OTM Put, Buy 1 OTM Put (Lower Strike), Sell 1 OTM Call, Buy 1 OTM Call (Higher Strike)
Breakeven Point Strike Price of Short Call + Net Premium Received Upper Breakeven Point = Strike Price of Short Call + Net Premium Received, Lower Breakeven Point = Strike Price of Short Put - Net Premium Received

BEAR CALL SPREAD Vs IRON CONDORS - Risk & Reward

BEAR CALL SPREAD IRON CONDORS
Maximum Profit Scenario Max Profit = Net Premium Received - Commissions Paid Net Premium Received - Commissions Paid
Maximum Loss Scenario Maximum Loss = Long Call Strike Price - Short Call Strike Price - Net Premium Received Strike Price of Long Call - Strike Price of Short Call - Net Premium Received + Commissions Paid
Risk Limited Limited
Reward Limited Limited

BEAR CALL SPREAD Vs IRON CONDORS - Strategy Pros & Cons

BEAR CALL SPREAD IRON CONDORS
Similar Strategies Bear Put Spread, Bull Call Spread Long Put Butterfly, Neutral Calendar Spread
Disadvantage • Limited amount of profit. • Margin requirement, more commission charges. • Full of risk. • Unlimited maximum loss.
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. • Chance to gather double premium. • Sure, maximum gains on one-half the trade. • Flexible and double leverage at half price.

BEAR CALL SPREAD

IRON CONDORS