PROTECTIVE CALL	COVERED PUT
About Strategy	Protective Call Option Strategy This strategy is simply the reversal of the Synthetic Call Strategy. This strategy is implemented when a trader is bearish on the market and expects to go down. Trader will short underlying stock in the cash market and buy either an ATM Call Option or OTM Call Option. The Call Option is bought to protect / hedge the upside risk on the short position. The Read more..	Covered Put Option Strategy  This strategy is exactly opposite to Covered Call Strategy. Here the investor is neutral or moderately bearish in nature and wants to take advantage of the price fall in the near future. The trader will short one lot of stock future. Now the trader will short ATM Put Option, the option strike price will be his exit price. If the prices rally above the strike price, the .. Read more..

PROTECTIVE CALL Vs COVERED PUT - Details

	PROTECTIVE CALL	COVERED PUT
Market View	Bearish	Bearish
Type (CE/PE)	CE (Call Option)	PE (Put Option) + Underlying
Number Of Positions	1	2
Strategy Level	Beginners	Advance
Reward Profile	Unlimited	Limited
Risk Profile	Limited	Unlimited
Breakeven Point	Sale Price of Underlying + Premium Paid	Futures Price + Premium Received

PROTECTIVE CALL Vs COVERED PUT - When & How to use ?

	PROTECTIVE CALL	COVERED PUT
Market View	Bearish	Bearish
When to use?	This strategy is implemented when a trader is bearish on the market and expects to go down.	The Covered Put works well when the market is moderately Bearish.
Action	Buy 1 ATM Call	Sell Underlying Sell OTM Put Option
Breakeven Point	Sale Price of Underlying + Premium Paid	Futures Price + Premium Received

PROTECTIVE CALL Vs COVERED PUT - Risk & Reward

	PROTECTIVE CALL	COVERED PUT
Maximum Profit Scenario	Sale Price of Underlying - Price of Underlying - Premium Paid	The profit happens when the price of the underlying moves above strike price of Short Put.
Maximum Loss Scenario	Premium Paid + Call Strike Price - Sale Price of Underlying + Commissions Paid	Price of Underlying - Sale Price of Underlying - Premium Received
Risk	Limited	Unlimited
Reward	Unlimited	Limited

PROTECTIVE CALL Vs COVERED PUT - Strategy Pros & Cons

	PROTECTIVE CALL	COVERED PUT
Similar Strategies	Put Backspread, Long Put	Bear Put Spread, Bear Call Spread
Disadvantage	• Profitable when market moves as expected. • Not good for beginners.	• Limited profit, unlimited risk. • Trader should have enough experience before using this strategy.
Advantages	• Limited risk if the market moves in opposite direction as expected. • Allows you to keep open a profitable position to make further profits. • Unlimited profit potential.	• Investors can book profit when underlying stock price drop, move sideways or rises by a small amount. • Able to generate monthly income. • Able to generate profit from fall in prices or mild increase in the prices.