PROTECTIVE CALL	CALL BACKSPREAD
About Strategy	Protective Call Option Strategy This strategy is simply the reversal of the Synthetic Call Strategy. This strategy is implemented when a trader is bearish on the market and expects to go down. Trader will short underlying stock in the cash market and buy either an ATM Call Option or OTM Call Option. The Call Option is bought to protect / hedge the upside risk on the short position. The Read more..	Call Backspread Option Trading  This strategy is adopted by traders who are bullish in nature. He expects market and volatility to rise in the near future. A trader need not be direction specific here (i.e. an upward or downward trend, but a small bias towards an uptrend should always be present, as the gains will be much higher once the market moves up r .. Read more..

PROTECTIVE CALL Vs CALL BACKSPREAD - Details

	PROTECTIVE CALL	CALL BACKSPREAD
Market View	Bearish	Bullish
Type (CE/PE)	CE (Call Option)	CE (Call Option)
Number Of Positions	1	3
Strategy Level	Beginners	Advance
Reward Profile	Unlimited	Unlimited
Risk Profile	Limited	Limited
Breakeven Point	Sale Price of Underlying + Premium Paid	Lower breakeven = strike price of the short call, Upper breakeven = strike price of long calls + point of maximum loss

PROTECTIVE CALL Vs CALL BACKSPREAD - When & How to use ?

	PROTECTIVE CALL	CALL BACKSPREAD
Market View	Bearish	Bullish
When to use?	This strategy is implemented when a trader is bearish on the market and expects to go down.	This strategy is used when the investor expects the price of the stock to rise in the future.
Action	Buy 1 ATM Call	Sell 1 ITM Call, BUY 2 OTM Call
Breakeven Point	Sale Price of Underlying + Premium Paid	Lower breakeven = strike price of the short call, Upper breakeven = strike price of long calls + point of maximum loss

PROTECTIVE CALL Vs CALL BACKSPREAD - Risk & Reward

	PROTECTIVE CALL	CALL BACKSPREAD
Maximum Profit Scenario	Sale Price of Underlying - Price of Underlying - Premium Paid	Unlimited profit potential if the stock goes in upward direction.
Maximum Loss Scenario	Premium Paid + Call Strike Price - Sale Price of Underlying + Commissions Paid	Strike Price of long call - Strike Price of short call - Net premium received
Risk	Limited	Limited
Reward	Unlimited	Unlimited

PROTECTIVE CALL Vs CALL BACKSPREAD - Strategy Pros & Cons

	PROTECTIVE CALL	CALL BACKSPREAD
Similar Strategies	Put Backspread, Long Put	-
Disadvantage	• Profitable when market moves as expected. • Not good for beginners.
Advantages	• Limited risk if the market moves in opposite direction as expected. • Allows you to keep open a profitable position to make further profits. • Unlimited profit potential.	• Unlimited profit potential.