Compare Strategies
CHRISTMAS TREE SPREAD WITH CALL OPTION STRATEGY | MARRIED PUT | |
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About Strategy |
Christmas Tree Spread with Call Option StrategyThis Strategy is an advance option strategy that consists of three legs and six total options. In this strategy buying one call at strike price A, skipping strike price B, writes three calls at strike price C, and buying two calls at strike price D for same expiration dates for neutral to bullish forecast. An investor used this strategy to potential retur |
Married Put Option StrategyThis strategy is applied when trader goes long on the underlying asset i.e. he buys the stock in cash market. He has a bullish view and expects the market to rise in the near future, but simultaneously has the fear of downward movement of the markets. In order to cover his position from vulnerabilities he buys one ATM Put Option of the same underlying asset. Here, a trader wi .. |
CHRISTMAS TREE SPREAD WITH CALL OPTION STRATEGY Vs MARRIED PUT - Details
CHRISTMAS TREE SPREAD WITH CALL OPTION STRATEGY | MARRIED PUT | |
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Market View | Bullish | Bullish |
Type (CE/PE) | CE (Call Option) | PE (Put Option) |
Number Of Positions | 4 | 1 |
Strategy Level | Advance | Beginners |
Reward Profile | Limited | Unlimited |
Risk Profile | Limited | Limited |
Breakeven Point | Lowest strike prices + premium paid – the half premium. | Purchase Price of Underlying + Premium Paid |
CHRISTMAS TREE SPREAD WITH CALL OPTION STRATEGY Vs MARRIED PUT - When & How to use ?
CHRISTMAS TREE SPREAD WITH CALL OPTION STRATEGY | MARRIED PUT | |
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Market View | Bullish | Bullish |
When to use? | This Strategy is used when an investor wants potential returns. | This Strategy work when the investor goes long in any stock. He expects the rise in market in future. |
Action | • Buy 1 call , • Sell 3 calls, • Buy 2 calls | Buy 250 XYZ Shares, Buy 1 ATM Put Option |
Breakeven Point | Lowest strike prices + premium paid – the half premium. | Purchase Price of Underlying + Premium Paid |
CHRISTMAS TREE SPREAD WITH CALL OPTION STRATEGY Vs MARRIED PUT - Risk & Reward
CHRISTMAS TREE SPREAD WITH CALL OPTION STRATEGY | MARRIED PUT | |
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Maximum Profit Scenario | Equal middle strike price – lower strike price – the premium | Profit = Price of Underlying - Purchase Price of Underlying - Premium Paid |
Maximum Loss Scenario | Net Debit paid for the strategy. | Max Loss = Premium Paid + Commissions Paid |
Risk | Limited | Limited |
Reward | Limited | Unlimited |
CHRISTMAS TREE SPREAD WITH CALL OPTION STRATEGY Vs MARRIED PUT - Strategy Pros & Cons
CHRISTMAS TREE SPREAD WITH CALL OPTION STRATEGY | MARRIED PUT | |
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Similar Strategies | CHRISTMAS TREE SPREAD WITH PUT OPTION | Long Call |
Disadvantage | • Potential profit is lower or limited. | Cost of the put options eats into profit margin. |
Advantages | • The potential of loss is limited. | Unlimited Profit and Limited Risk |