RATIO CALL WRITE	THE 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..	The Collar Option Strategy Collar Strategy is an extension to Covered Call Strategy. A trader, who is bullish in nature but has a very low risk appetite and wants to mitigate his risk will implement the Collar Strategy. Collar involves buying of stock in either Cash/Futures Market, buying an ATM Put Option & selling an OTM Call Option. The expiry dates of the op .. Read more..

RATIO CALL WRITE Vs THE COLLAR - Details

	RATIO CALL WRITE	THE COLLAR
Market View	Neutral	Bullish
Type (CE/PE)	CE (Call Option)	CE (Call Option) + PE (Put Option) + Underlying
Number Of Positions	2	3
Strategy Level	Beginners	Advance
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	Price of Features - Call Premium + Put Premium

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

	RATIO CALL WRITE	THE COLLAR
Market View	Neutral	Bullish
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.	It should be used only in case where trader is certain about the bearish market view.
Action	Sell 2 ATM Calls	Buy Underlying, Buy 1 ATM Put Option, Sell 1 OTM Call 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	Price of Features - Call Premium + Put Premium

RATIO CALL WRITE Vs THE COLLAR - Risk & Reward

	RATIO CALL WRITE	THE COLLAR
Maximum Profit Scenario	Net Premium Received - Commissions Paid	Strike Price of Short Call - Purchase Price of Underlying + Net Premium 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	Purchase Price of Underlying - Strike Price of Long Put - Net Premium Received
Risk	Unlimited	Limited
Reward	Limited	Limited

RATIO CALL WRITE Vs THE COLLAR - Strategy Pros & Cons

	RATIO CALL WRITE	THE COLLAR
Similar Strategies	Variable Ratio Write	Call Spread, Bull Put Spread
Disadvantage	• Potential loss is higher than gain. • Limited profit.	• Limited profit. • A trader can book more profit without this strategy if the prices goes high.
Advantages		• This strategy protects the losses on underlying asset. • Risk gets limited if the price of the stocks goes down. • Trader can get ownership benefits life dividend and voting rights.