PROTECTIVE COLLAR	BEAR CALL SPREAD
About Strategy	Protective Collar Strategy This Strategy is implemented when the investor requires downside protection for the short - to medium term but at lower cost. Buying protective puts can be an expensive proposition and writing OTM calls can defray the cost of the puts quite substantially. Protective Collar is considered as bearish to neutral strategy. In this strategy risk and reward is both are limited. This Read more..	Bear Call Spread Option Strategy  Bear 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 .. Read more..

PROTECTIVE COLLAR Vs BEAR CALL SPREAD - Details

	PROTECTIVE COLLAR	BEAR CALL SPREAD
Market View	Neutral	Bearish
Type (CE/PE)	CE (Call Option) + PE (Put Option)	CE (Call Option)
Number Of Positions	2	2
Strategy Level	Beginners	Beginners
Reward Profile	Limited	Limited
Risk Profile	Limited	Limited
Breakeven Point	Purchase Price of Underlying + Net Premium Paid	Strike Price of Short Call + Net Premium Received

PROTECTIVE COLLAR Vs BEAR CALL SPREAD - When & How to use ?

	PROTECTIVE COLLAR	BEAR CALL SPREAD
Market View	Neutral	Bearish
When to use?	This Strategy is implemented when the investor requires downside protection for the short - to medium term but at lower cost.	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	• Short 1 Call Option, • Long 1 Put Option	Buy OTM Call Option, Sell ITM Call Option
Breakeven Point	Purchase Price of Underlying + Net Premium Paid	Strike Price of Short Call + Net Premium Received

PROTECTIVE COLLAR Vs BEAR CALL SPREAD - Risk & Reward

	PROTECTIVE COLLAR	BEAR CALL SPREAD
Maximum Profit Scenario	• Call strike - stock purchase price - net premium paid + net credit received	Max Profit = Net Premium Received - Commissions Paid
Maximum Loss Scenario	• Stock purchase price - put strike - net premium paid - put strike + net credit received	Maximum Loss = Long Call Strike Price - Short Call Strike Price - Net Premium Received
Risk	Limited	Limited
Reward	Limited	Limited

PROTECTIVE COLLAR Vs BEAR CALL SPREAD - Strategy Pros & Cons

	PROTECTIVE COLLAR	BEAR CALL SPREAD
Similar Strategies	Bull Put Spread, Bull Call Spread	Bear Put Spread, Bull Call Spread
Disadvantage	• Potential profit is lower or limited.	• Limited amount of profit. • Margin requirement, more commission charges.
Advantages	The Risk is limited.	• 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.