RATIO CALL WRITE	PROTECTIVE PUT
About Strategy	Ratio Call Write Option Strategy  This strategy involves buying of an underlying asset in the cash/futures market and simultaneously selling ATM Calls double the number of long quantity. This strategy is used by a trader who is 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. Read more..	Protective Put Option Strategy Protective Put Strategy is a hedging strategy where trader guards himself from the downside risk. This strategy is adopted when a trader is long on the underlying asset but skeptical of the downside. He will buy one ATM Put Option to hedge his position. Now, if the underlying asset moves either up or down, the trader is in a safe position. Read more..

RATIO CALL WRITE Vs PROTECTIVE PUT - Details

	RATIO CALL WRITE	PROTECTIVE PUT
Market View	Neutral	Bullish
Type (CE/PE)	CE (Call Option)	PE (Put Option)
Number Of Positions	2	1
Strategy Level	Beginners	Beginners
Reward Profile	Limited	Unlimited
Risk Profile	Unlimited	Limited
Breakeven Point	Upper Breakeven Point = Strike Price of Short Calls + Points of Maximum Profit, Lower Breakeven Point = Strike Price of Short Calls - Points of Maximum Profit	Purchase Price of Underlying + Premium Paid

RATIO CALL WRITE Vs PROTECTIVE PUT - When & How to use ?

	RATIO CALL WRITE	PROTECTIVE PUT
Market View	Neutral	Bullish
When to use?	This strategy is used by a trader who is neutral on the market and bearish on the volatility in the near future.	This strategy is adopted when a trader is long on the underlying asset but skeptical of the downside.
Action	Sell 2 ATM Calls	Buy 1 ATM Put
Breakeven Point	Upper Breakeven Point = Strike Price of Short Calls + Points of Maximum Profit, Lower Breakeven Point = Strike Price of Short Calls - Points of Maximum Profit	Purchase Price of Underlying + Premium Paid

RATIO CALL WRITE Vs PROTECTIVE PUT - Risk & Reward

	RATIO CALL WRITE	PROTECTIVE PUT
Maximum Profit Scenario	Net Premium Received - Commissions Paid	Price of Underlying - Purchase Price of Underlying - Premium Paid
Maximum Loss Scenario	Price of Underlying - Strike Price of Short Call - Net Premium Received OR Purchase Price of Underlying - Price of Underlying - Net Premium Received + Commissions Paid	Premium Paid + Purchase Price of Underlying - Put Strike + Commissions Paid
Risk	Unlimited	Limited
Reward	Limited	Unlimited

RATIO CALL WRITE Vs PROTECTIVE PUT - Strategy Pros & Cons

	RATIO CALL WRITE	PROTECTIVE PUT
Similar Strategies	Variable Ratio Write	Long Call, Call Backspread
Disadvantage	• Potential loss is higher than gain. • Limited profit.	• Value of protective put position decreases as time passes • Holding period of the protective put can be affected by the timing as a result tax rate on the profit or loss from the stock can be affected.
Advantages		• Unlimited potential profit due to indefinitely rise in the underlying stock price . • This strategy allows you to hold on to your stocks while insuring against losses. • Hedging strategy, trader can guard himself from the downside risk.