Compare Strategies
SHORT CALL LADDER | BEAR CALL SPREAD | |
---|---|---|
![]() |
![]() |
|
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:
|
Bear Call Spread Option StrategyBear Call Spread option trading strategy is used by a trader who is bearish in nature and expects the underlying asset to dip in the near future. This strategy includes buying of an ‘Out of the Money’ Call Option and selling one ‘In the Money’ Call Option of the same underlying asset and the same expiration date. When you write a call, you receive premium thereby r .. |
SHORT CALL LADDER Vs BEAR CALL SPREAD - Details
SHORT CALL LADDER | BEAR CALL SPREAD | |
---|---|---|
Market View | Neutral | Bearish |
Type (CE/PE) | CE (Call Option) | CE (Call Option) |
Number Of Positions | 3 | 2 |
Strategy Level | Advance | Beginners |
Reward Profile | Unlimited | Limited |
Risk Profile | Limited | Limited |
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 | Strike Price of Short Call + Net Premium Received |
SHORT CALL LADDER Vs BEAR CALL SPREAD - When & How to use ?
SHORT CALL LADDER | BEAR CALL SPREAD | |
---|---|---|
Market View | Neutral | Bearish |
When to use? | This strategy is implemented when a trader is moderately bullish on the market, and volatility | This strategy is used when you are bearish in market view. The strategy minimizes your risk in the event of prime movements going against your expectations. |
Action | Sell 1 ITM Call, Buy 1 ATM Call, Buy 1 OTM Call | Buy OTM Call Option, Sell ITM Call Option |
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 | Strike Price of Short Call + Net Premium Received |
SHORT CALL LADDER Vs BEAR CALL SPREAD - Risk & Reward
SHORT CALL LADDER | BEAR CALL SPREAD | |
---|---|---|
Maximum Profit Scenario | Profit Achieved When Price of Underlying > Total Strike Prices of Long Calls - Strike Price of Short Call + Net Premium Received | Max Profit = 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 | Maximum Loss = Long Call Strike Price - Short Call Strike Price - Net Premium Received |
Risk | Limited | Limited |
Reward | Unlimited | Limited |
SHORT CALL LADDER Vs BEAR CALL SPREAD - Strategy Pros & Cons
SHORT CALL LADDER | BEAR CALL SPREAD | |
---|---|---|
Similar Strategies | Short Put Ladder, Strip, Strap | Bear Put Spread, Bull Call Spread |
Disadvantage | • Unlimited risk. • Margin required. | • Limited amount of profit. • Margin requirement, more commission charges. |
Advantages | • Higher probability of profit. • Unlimited upside profit. • Limited maximum loss. | • This strategy takes advantage of time decay. • Investors can get profit in a flat market scenario. • Investors can earn options premium income with a lower degree of risk. |