COVERED CALL	PUT BACKSPREAD
About Strategy	Covered Call Option Strategy Mr. X owns Reliance Shares and expects the price to rise in the near future. Mr. X is entitled to receive dividends for the shares he hold in cash market. Covered Call Strategy involves selling of OTM Call Option of the same underlying asset. The OTM Call Option Strike Price will generally be the price, where Mr. X will look to get out o Read more..	Put Backspread Option Strategy If the trader is bearish on market and bullish in volatility, he will implement this strategy. However the trader can be neutral in nature i.e. indifferent if the market moves in either of the direction, this strategy will make profits, but uptrend will give a capped income than downtrend which will give unlimited returns. Read more..

COVERED CALL Vs PUT BACKSPREAD - Details

	COVERED CALL	PUT BACKSPREAD
Market View	Bullish	Bearish
Type (CE/PE)	CE (Call Option)	PE (Put Option)
Number Of Positions	2	2
Strategy Level	Advance	Advance
Reward Profile	Limited
Risk Profile	Unlimited
Breakeven Point	Purchase Price of Underlying- Premium Received

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

	COVERED CALL	PUT BACKSPREAD
Market View	Bullish	Bearish
When to use?	An investor has a short term neutral view on the asset and for this reason holds the asset long and has a short position to generate income.
Action	(Buy Underlying) (Sell OTM Call Option)
Breakeven Point	Purchase Price of Underlying- Premium Received

COVERED CALL Vs PUT BACKSPREAD - Risk & Reward

	COVERED CALL	PUT BACKSPREAD
Maximum Profit Scenario	[Call Strike Price - Stock Price Paid] + Premium Received
Maximum Loss Scenario	Purchase Price of Underlying - Price of Underlying) + Premium Received
Risk	Unlimited	Limited
Reward	Limited	Unlimited

COVERED CALL Vs PUT BACKSPREAD - Strategy Pros & Cons

	COVERED CALL	PUT BACKSPREAD
Similar Strategies	Bull Call Spread
Disadvantage	• Unlimited risk, limited reward. • Inability to earn interest on the proceed used to buy the underlying stock.
Advantages	• Profit from option premium, rise in the underlying stock and dividends on the stock. • Allows you to generate income from your holding. • Profit when underlying stock price rise, move sideways or marginal fall.