PROTECTIVE CALL	PROTECTIVE COLLAR
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..	Protective Collar Strategy This Strategy is implemented when the investor requires downside protection for the short - to medium term but at lower cost. Buying protective puts can be an expensive proposition and writing OTM calls can defray the cost of the puts quite substantially. Protective Collar is considered as bearish to neutral strategy. In this strategy risk and reward is both are limited. This .. Read more..

PROTECTIVE CALL Vs PROTECTIVE COLLAR - Details

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

PROTECTIVE CALL Vs PROTECTIVE COLLAR - When & How to use ?

	PROTECTIVE CALL	PROTECTIVE COLLAR
Market View	Bearish	Neutral
When to use?	This strategy is implemented when a trader is bearish on the market and expects to go down.	This Strategy is implemented when the investor requires downside protection for the short - to medium term but at lower cost.
Action	Buy 1 ATM Call	• Short 1 Call Option, • Long 1 Put Option
Breakeven Point	Sale Price of Underlying + Premium Paid	Purchase Price of Underlying + Net Premium Paid

PROTECTIVE CALL Vs PROTECTIVE COLLAR - Risk & Reward

	PROTECTIVE CALL	PROTECTIVE COLLAR
Maximum Profit Scenario	Sale Price of Underlying - Price of Underlying - Premium Paid	• Call strike - stock purchase price - net premium paid + net credit received
Maximum Loss Scenario	Premium Paid + Call Strike Price - Sale Price of Underlying + Commissions Paid	• Stock purchase price - put strike - net premium paid - put strike + net credit received
Risk	Limited	Limited
Reward	Unlimited	Limited

PROTECTIVE CALL Vs PROTECTIVE COLLAR - Strategy Pros & Cons

	PROTECTIVE CALL	PROTECTIVE COLLAR
Similar Strategies	Put Backspread, Long Put	Bull Put Spread, Bull Call Spread
Disadvantage	• Profitable when market moves as expected. • Not good for beginners.	• Potential profit is lower or limited.
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.	The Risk is limited.