RATIO CALL WRITE	PROTECTIVE COLLAR
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 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..

RATIO CALL WRITE Vs PROTECTIVE COLLAR - Details

	RATIO CALL WRITE	PROTECTIVE COLLAR
Market View	Neutral	Neutral
Type (CE/PE)	CE (Call Option)	CE (Call Option) + PE (Put Option)
Number Of Positions	2	2
Strategy Level	Beginners	Beginners
Reward Profile	Limited	Limited
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 + Net Premium Paid

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

	RATIO CALL WRITE	PROTECTIVE COLLAR
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 implemented when the investor requires downside protection for the short - to medium term but at lower cost.
Action	Sell 2 ATM Calls	• Short 1 Call Option, • Long 1 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	Purchase Price of Underlying + Net Premium Paid

RATIO CALL WRITE Vs PROTECTIVE COLLAR - Risk & Reward

	RATIO CALL WRITE	PROTECTIVE COLLAR
Maximum Profit Scenario	Net Premium Received - Commissions Paid	• Call strike - stock purchase price - net premium paid + net credit received
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	• Stock purchase price - put strike - net premium paid - put strike + net credit received
Risk	Unlimited	Limited
Reward	Limited	Limited

RATIO CALL WRITE Vs PROTECTIVE COLLAR - Strategy Pros & Cons

	RATIO CALL WRITE	PROTECTIVE COLLAR
Similar Strategies	Variable Ratio Write	Bull Put Spread, Bull Call Spread
Disadvantage	• Potential loss is higher than gain. • Limited profit.	• Potential profit is lower or limited.
Advantages		The Risk is limited.