Compare Strategies
BULL CALENDER SPREAD | LONG PUT | |
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About Strategy |
Bull Calendar Spread Option StrategyThis strategy is implemented when a trader is bullish on the underlying stock/index in the short term say 2 months or so. A trader will write one Near Month OTM Call Option and buy one next Month OTM Call Option, thereby reducing the cost of purchase, with the same strike price of the same underlying asset. This strategy is used when a trader wants to make prof |
Long Put Option StrategyThis strategy is implemented by buying 1 Put Option i.e. a single position, when the person is bearish on the market and expects the market to move downwards in the near future. |
BULL CALENDER SPREAD Vs LONG PUT - Details
BULL CALENDER SPREAD | LONG PUT | |
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Market View | Bullish | Bearish |
Type (CE/PE) | CE (Call Option) + PE (Put Option) | PE (Put Option) |
Number Of Positions | 2 | 1 |
Strategy Level | Beginners | Beginners |
Reward Profile | Unlimited | Unlimited |
Risk Profile | Limited | Limited |
Breakeven Point | Stock Price when long call value is equal to net debit. | Strike Price of Long Put - Premium Paid |
BULL CALENDER SPREAD Vs LONG PUT - When & How to use ?
BULL CALENDER SPREAD | LONG PUT | |
---|---|---|
Market View | Bullish | Bearish |
When to use? | This strategy is used when a trader wants to make profit from a steady increase in the stock price over a short period of time. | A long put option strategy works well when you're expecting the underlying asset to sharply decline or be volatile in near future. |
Action | Sell 1 Near-Term OTM Call, Buy 1 Long-Term OTM Call | Buy Put Option |
Breakeven Point | Stock Price when long call value is equal to net debit. | Strike Price of Long Put - Premium Paid |
BULL CALENDER SPREAD Vs LONG PUT - Risk & Reward
BULL CALENDER SPREAD | LONG PUT | |
---|---|---|
Maximum Profit Scenario | You have unlimited profit potential to the upside. | Profit = Strike Price of Long Put - Premium Paid |
Maximum Loss Scenario | Max Loss = Premium Paid + Commissions Paid | Max Loss = Premium Paid + Commissions Paid |
Risk | Limited | Limited |
Reward | Unlimited | Unlimited |
BULL CALENDER SPREAD Vs LONG PUT - Strategy Pros & Cons
BULL CALENDER SPREAD | LONG PUT | |
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Similar Strategies | The Collar, Bull Put Spread | Protective Call, Short Put |
Disadvantage | • Limited profit even if underlying asset rallies. • If the short call options are assigned when the underlying asset rallies then losses can be sustained. | • 100% loss if strike price, expiration dates or underlying stocks are badly chosen. • Time decay. |
Advantages | • Limited losses to the net debit. • Enable trader to book profit even if underlying asset stays stagnant. • If the market trends reverse, cashing in from stock price movement at limited risk. | • Limited risk to the premium paid. • Less capital investment and more profit. • Unlimited profit potential with limited risk. |