RATIO CALL WRITE	STRAP
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..	Strap Option Strategy  Strap Strategy is similar to Long Straddle, the only difference is the quantity traded. A trader will buy two Call Options and one Put Options. In this strategy, a trader is very bullish on the market and volatility on upside but wants to hedge himself in case the stock doesn’t perform as per his expectations. This strategy will make more profits compared to long straddle sin .. Read more..

RATIO CALL WRITE Vs STRAP - Details

	RATIO CALL WRITE	STRAP
Market View	Neutral	Neutral
Type (CE/PE)	CE (Call Option)	CE (Call Option) + PE (Put Option)
Number Of Positions	2	3
Strategy Level	Beginners	Beginners
Reward Profile	Limited	Profit Achieved When Price of Underlying > Strike Price of Calls/Puts + (Net Premium Paid/2) OR Price of Underlying < Strike Price of Calls/Puts - Net Premium Paid
Risk Profile	Unlimited	Max Loss Occurs When Price of Underlying = Strike Price of Calls/Puts
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	Strike Price of Calls/Puts + (Net Premium Paid/2)

RATIO CALL WRITE Vs STRAP - When & How to use ?

	RATIO CALL WRITE	STRAP
Market View	Neutral	Neutral
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 used when the investor is bullish on the stock and expects volatility in the near future.
Action	Sell 2 ATM Calls	Buy 2 ATM Call Option, Buy 1 ATM Put Option
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	Strike Price of Calls/Puts + (Net Premium Paid/2)

RATIO CALL WRITE Vs STRAP - Risk & Reward

	RATIO CALL WRITE	STRAP
Maximum Profit Scenario	Net Premium Received - Commissions Paid	UNLIMITED
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	Net Premium Paid
Risk	Unlimited	Limited
Reward	Limited	Unlimited

RATIO CALL WRITE Vs STRAP - Strategy Pros & Cons

	RATIO CALL WRITE	STRAP
Similar Strategies	Variable Ratio Write	Strip, Short Put Ladder, Short Call Ladder
Disadvantage	• Potential loss is higher than gain. • Limited profit.	• To generate profit, there should be significant change in share price. • Expensive strategy.
Advantages		• Limited loss. • If share prices are moving then traders can book unlimited profit. • A trader can still book profit if the underlying falls substantially.