Compare Strategies
RATIO PUT WRITE | LONG CALL CONDOR SPREAD | |
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About Strategy |
Ratio Put Write Option StrategyThis strategy is implemented by selling (short) the underlying asset in the cash/futures market. Simultaneously, sell ATM Puts double the number of long quantity. This strategy is used by a trader who in neutral on the market and bearish on the volatility in the near future. Here profits will be capped up to the premium amount and risk will be potentially unlimited. |
Long Call Condor Spread Option StrategyThis strategy is implemented when a trader is bearish on the volatility and expects the market to move sideways. Using Call Options of the same expiry date, he will buy one Deep ITM Call Option, sell 1 ITM Call Option, sell 1 OTM Call Option, buy 1 Deep OTM Call Option. The risk and reward both are limited due to offsetting of long and short positions. For t .. |
RATIO PUT WRITE Vs LONG CALL CONDOR SPREAD - Details
RATIO PUT WRITE | LONG CALL CONDOR SPREAD | |
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Market View | Neutral | Neutral |
Type (CE/PE) | PE (Put Option) | CE (Call Option) |
Number Of Positions | 2 | 4 |
Strategy Level | Beginners | Advance |
Reward Profile | Max Profit Achieved When Price of Underlying = Strike Price of Short Puts | Limited |
Risk Profile | Loss Occurs When Price of Underlying < Strike Price of Short Put - Net Premium Received OR Price of Underlying > Strike Price of Short Put + Net Premium Received | Limited |
Breakeven Point | Upper Breakeven Point = Strike Price of Short Puts + Points of Maximum Profit Lower Breakeven Point = Strike Price of Short Puts - Points of Maximum Profit | Lower Breakeven = Lower Strike Price + Net Premium Upper breakeven = Higher Strike Price - Net Premium |
RATIO PUT WRITE Vs LONG CALL CONDOR SPREAD - When & How to use ?
RATIO PUT WRITE | LONG CALL CONDOR SPREAD | |
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Market View | Neutral | Neutral |
When to use? | This strategy is implemented by selling (short) the underlying asset in the cash/futures market. This strategy is used by a trader who in neutral on the market and bearish on the volatility in the near future | This strategy works well when you expect the price of the underlying asset to be range bound in the coming days. |
Action | Sell 2 ATM Puts | Buy Deep ITM Call Option, Buy Deep OTM Call Option, Sell ITM Call Option, Sell OTM Call Option |
Breakeven Point | Upper Breakeven Point = Strike Price of Short Puts + Points of Maximum Profit Lower Breakeven Point = Strike Price of Short Puts - Points of Maximum Profit | Lower Breakeven = Lower Strike Price + Net Premium Upper breakeven = Higher Strike Price - Net Premium |
RATIO PUT WRITE Vs LONG CALL CONDOR SPREAD - Risk & Reward
RATIO PUT WRITE | LONG CALL CONDOR SPREAD | |
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Maximum Profit Scenario | Net Premium Received - Commissions Paid | Strike Price of Lower Strike Short Call - Strike Price of Lower Strike Long Call - Net Premium Paid |
Maximum Loss Scenario | Price of Underlying - Sale Price of Underlying - Net Premium Received OR Strike Price of Short Put - Price of Underlying - Net Premium Received + Commissions Paid | Net Premium Paid |
Risk | Unlimited | Limited |
Reward | Limited | Limited |
RATIO PUT WRITE Vs LONG CALL CONDOR SPREAD - Strategy Pros & Cons
RATIO PUT WRITE | LONG CALL CONDOR SPREAD | |
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Similar Strategies | Short Strangle and Short Straddle | Long Put Butterfly, Short Call Condor, Short Strangle |
Disadvantage | • Potential loss is higher than gain. • Limited profit. | • Amount of profit is comparatively low. • As this strategy has 4 legs so the brokerage cost is higher that will affect your profit. |
Advantages | • Capable to generate profit even if there is low volatility in the market. • This strategy is associated with limited risk and limited profit. • Wider profit zone. |