Compare Strategies
SHORT CALL LADDER | RATIO PUT WRITE | |
---|---|---|
![]() |
![]() |
|
About Strategy |
Short Call Ladder Option StrategyThis strategy is implemented when a trader is moderately bullish on the market, and volatility. It involves sale of an ITM Call Option, buying of an ATM Call Option & OTM Call Option. The risk associated with the strategy is limited. Risk:
|
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. .. |
SHORT CALL LADDER Vs RATIO PUT WRITE - Details
SHORT CALL LADDER | RATIO PUT WRITE | |
---|---|---|
Market View | Neutral | Neutral |
Type (CE/PE) | CE (Call Option) | PE (Put Option) |
Number Of Positions | 3 | 2 |
Strategy Level | Advance | Beginners |
Reward Profile | Unlimited | Max Profit Achieved When Price of Underlying = Strike Price of Short Puts |
Risk Profile | Limited | 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 |
Breakeven Point | Upper Breakeven Point = Total Strike Prices of Long Calls - Strike Price of Short Call + Net Premium Received Lower Breakeven Point = Strike Price of Short Call - Net Premium Received | Upper Breakeven Point = Strike Price of Short Puts + Points of Maximum Profit Lower Breakeven Point = Strike Price of Short Puts - Points of Maximum Profit |
SHORT CALL LADDER Vs RATIO PUT WRITE - When & How to use ?
SHORT CALL LADDER | RATIO PUT WRITE | |
---|---|---|
Market View | Neutral | Neutral |
When to use? | This strategy is implemented when a trader is moderately bullish on the market, and volatility | 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 |
Action | Sell 1 ITM Call, Buy 1 ATM Call, Buy 1 OTM Call | Sell 2 ATM Puts |
Breakeven Point | Upper Breakeven Point = Total Strike Prices of Long Calls - Strike Price of Short Call + Net Premium Received Lower Breakeven Point = Strike Price of Short Call - Net Premium Received | Upper Breakeven Point = Strike Price of Short Puts + Points of Maximum Profit Lower Breakeven Point = Strike Price of Short Puts - Points of Maximum Profit |
SHORT CALL LADDER Vs RATIO PUT WRITE - Risk & Reward
SHORT CALL LADDER | RATIO PUT WRITE | |
---|---|---|
Maximum Profit Scenario | Profit Achieved When Price of Underlying > Total Strike Prices of Long Calls - Strike Price of Short Call + Net Premium Received | Net Premium Received - Commissions Paid |
Maximum Loss Scenario | Strike Price of Lower Strike Long Call - Strike Price of Short Call - Net Premium Received + Commissions Paid | Price of Underlying - Sale Price of Underlying - Net Premium Received OR Strike Price of Short Put - Price of Underlying - Net Premium Received + Commissions Paid |
Risk | Limited | Unlimited |
Reward | Unlimited | Limited |
SHORT CALL LADDER Vs RATIO PUT WRITE - Strategy Pros & Cons
SHORT CALL LADDER | RATIO PUT WRITE | |
---|---|---|
Similar Strategies | Short Put Ladder, Strip, Strap | Short Strangle and Short Straddle |
Disadvantage | • Unlimited risk. • Margin required. | • Potential loss is higher than gain. • Limited profit. |
Advantages | • Higher probability of profit. • Unlimited upside profit. • Limited maximum loss. |