Compare Strategies
SYNTHETIC LONG CALL | SYNTHETIC LONG CALL | |
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About Strategy |
Synthetic Long Call Option StrategyA 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, |
Synthetic Long Call Option StrategyA 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, .. |
SYNTHETIC LONG CALL Vs SYNTHETIC LONG CALL - Details
SYNTHETIC LONG CALL | SYNTHETIC LONG CALL | |
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Market View | Bullish | Bullish |
Type (CE/PE) | CE (Call Option) | CE (Call Option) |
Number Of Positions | 2 | 2 |
Strategy Level | Beginners | Beginners |
Reward Profile | When Price of Underlying > Purchase Price of Underlying + Premium Paid | When Price of Underlying > Purchase Price of Underlying + Premium Paid |
Risk Profile | Limited (Maximum loss happens when the price of instrument move above from the strike price of put) | Limited (Maximum loss happens when the price of instrument move above from the strike price of put) |
Breakeven Point | Underlying Price + Put Premium | Underlying Price + Put Premium |
SYNTHETIC LONG CALL Vs SYNTHETIC LONG CALL - When & How to use ?
SYNTHETIC LONG CALL | SYNTHETIC LONG CALL | |
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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. | A trader is bullish in nature for short term, but also fearful about the downside risk associated with it. |
Action | Buy 1 ATM Put or OTM Put | Buy 1 ATM Put or OTM Put |
Breakeven Point | Underlying Price + Put Premium | Underlying Price + Put Premium |
SYNTHETIC LONG CALL Vs SYNTHETIC LONG CALL - Risk & Reward
SYNTHETIC LONG CALL | SYNTHETIC LONG CALL | |
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Maximum Profit Scenario | Current Price - Purchase Price - Premium Paid | Current Price - Purchase Price - Premium Paid |
Maximum Loss Scenario | Premium Paid | Premium Paid |
Risk | Limited | Limited |
Reward | Unlimited | Unlimited |
SYNTHETIC LONG CALL Vs SYNTHETIC LONG CALL - Strategy Pros & Cons
SYNTHETIC LONG CALL | SYNTHETIC LONG CALL | |
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Similar Strategies | Protective Put, Long Call | Protective Put, Long Call |
Disadvantage | •Chances of loss if the underlying goes down. •Incur losses if option is exercised. | •Chances of loss if the underlying goes down. •Incur losses if option is exercised. |
Advantages | •Limited risk, unlimited profit. •Protection to your long-term holdings. • Limited loss to the to the premium paid for Put option. | •Limited risk, unlimited profit. •Protection to your long-term holdings. • Limited loss to the to the premium paid for Put option. |