PROTECTIVE COLLAR	SYNTHETIC LONG CALL
About Strategy	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..	Synthetic Long Call Option Strategy A 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, .. Read more..

PROTECTIVE COLLAR Vs SYNTHETIC LONG CALL - Details

	PROTECTIVE COLLAR	SYNTHETIC LONG CALL
Market View	Neutral	Bullish
Type (CE/PE)	CE (Call Option) + PE (Put Option)	CE (Call Option)
Number Of Positions	2	2
Strategy Level	Beginners	Beginners
Reward Profile	Limited	When Price of Underlying > Purchase Price of Underlying + Premium Paid
Risk Profile	Limited	Limited (Maximum loss happens when the price of instrument move above from the strike price of put)
Breakeven Point	Purchase Price of Underlying + Net Premium Paid	Underlying Price + Put Premium

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

	PROTECTIVE COLLAR	SYNTHETIC LONG CALL
Market View	Neutral	Bullish
When to use?	This Strategy is implemented when the investor requires downside protection for the short - to medium term but at lower cost.	A trader is bullish in nature for short term, but also fearful about the downside risk associated with it.
Action	• Short 1 Call Option, • Long 1 Put Option	Buy 1 ATM Put or OTM Put
Breakeven Point	Purchase Price of Underlying + Net Premium Paid	Underlying Price + Put Premium

PROTECTIVE COLLAR Vs SYNTHETIC LONG CALL - Risk & Reward

	PROTECTIVE COLLAR	SYNTHETIC LONG CALL
Maximum Profit Scenario	• Call strike - stock purchase price - net premium paid + net credit received	Current Price - Purchase Price - Premium Paid
Maximum Loss Scenario	• Stock purchase price - put strike - net premium paid - put strike + net credit received	Premium Paid
Risk	Limited	Limited
Reward	Limited	Unlimited

PROTECTIVE COLLAR Vs SYNTHETIC LONG CALL - Strategy Pros & Cons

	PROTECTIVE COLLAR	SYNTHETIC LONG CALL
Similar Strategies	Bull Put Spread, Bull Call Spread	Protective Put, Long Call
Disadvantage	• Potential profit is lower or limited.	•Chances of loss if the underlying goes down. •Incur losses if option is exercised.
Advantages	The Risk is limited.	•Limited risk, unlimited profit. •Protection to your long-term holdings. • Limited loss to the to the premium paid for Put option.