When it comes to Options Trading, there are different complexities involved in terms of choosing a specific strategy that works the best for you.
At the same time, each strategy has its own set of advantages as well as limitations, thus making the concept of options trading even more challenging. Thus, in case you are looking to fit a particular strategy in your option trades, just check few areas before you make a choice.
In this detailed comparison of Bear Call Spread Vs Long Strangle options trading strategies, we will be looking at the below-mentioned aspects and more:
- Current Market Position
- Your Risk Appetite
- Your Trading Experience
- Profit Potential
- Intention and Expectation of a trader
- Break-even point of your trade
Apart from the Bear Call Spread Vs Long Strangle strategies, there are more than 25 comparisons of each of these strategies with other option strategies. With all these comparisons, you should be able to filter the ones that work the best for you.
Here is the detailed Bear Call Spread Vs Long Strangle comparison:
| Comparison Aspect | Bear Call Spread | Long Strangle |
| View |  |  |
| Strategy Introduction | The bear call spread consists of two calls, both with the same underlying asset and expiration date, but the strike price of the call options bought is less than the strike price of the same number of call options sold. Like most of the spread strategies, it is a limited-risk...more | The long strangle strategy helps the trader to take advantage of the volatility in the market. It is a trend neutral strategy, so the trader does not need to be certain of the direction...more |
| Investor Obligation | As a thumb rule, the expiration date must be about 30-45 days away in order to be able to take advantage of the accelerating time decay. | It is a trend neutral strategy, so the trader does not need to be certain of the direction of the price movement. |
| Market Position | Moderately Bearish | Neutral |
| Strategy Level Suitable for | Intermediates | Intermediates |
| Options Traded | Call | Call, Put |
| Number of Positions | 2 | 2 |
| Action Needed | Buy OTM Call, Sell OTM Call | One OTM Put, One OTM Call |
| Risk for You | Limited | Limited |
| Profit Potential | Limited | Unlimited |
| Break Even Point for Investor | Strike Price of Short Call + Net Premium Received | Lower Breakeven Point = Strike Price of Put - Net Premium Upper Breakeven Point = Strike Price of Call + Net Premium |
| Investor Intention | Let Options Expire Worthlessly | Both call and put options expire worthlessly |
| Investor Expectation | Market to go down gradually, but moderately | Market Shows High Volatility |
| Strategy Summary | Limited Risk Limited Profit | Attractive |
| Advantages | Profit when Market is going down, Limited Risk | Less Expensive, Limited Risk, Unlimited Gain |
| Disadvantages | Limited Profit | Price Movement has to be Big |
| Market Scenarios - Profit | 2 | 2 |
| Market Scenarios - Loss | 1 | 1 |
| Also called as | NA | NA |
| More Comparisons | Bear Call Spread Vs Short Put | Long Strangle Vs Short Put |
| Bear Call Spread Vs Long Combo | Long Strangle Vs Long Combo | |
| Bear Call Spread Vs Synthetic Call | Long Strangle Vs Synthetic Call | |
| Bear Call Spread Vs Long Put | Long Strangle Vs Long Put | |
| Bear Call Spread Vs Long Call | Long Strangle Vs Long Call | |
| Bear Call Spread Vs Covered Call | Long Strangle Vs Covered Call | |
| Bear Call Spread Vs Covered Put | Long Strangle Vs Covered Put | |
| Bear Call Spread Vs Protective Call | Long Strangle Vs Protective Call | |
| Bear Call Spread Vs Short Box | Long Strangle Vs Short Box | |
| Bear Call Spread Vs Long Call Condor | Long Strangle Vs Long Call Condor | |
| Bear Call Spread Vs Short Call Condor | Long Strangle Vs Short Call Condor | |
| Bear Call Spread Vs Box Spread | Long Strangle Vs Box Spread | |
| Bear Call Spread Vs Short Strangle | Long Strangle Vs Short Strangle | |
| Bear Call Spread Vs Long Strangle | Long Strangle Vs Short Call | |
| Bear Call Spread Vs Collar Strategy | Long Strangle Vs Collar Strategy | |
| Bear Call Spread Vs Long Straddle | Long Strangle Vs Long Straddle | |
| Bear Call Spread Vs Short Straddle | Long Strangle Vs Short Straddle | |
| Bear Call Spread Vs Long Call Butterfly | Long Strangle Vs Long Call Butterfly | |
| Bear Call Spread Vs Short Call Butterfly | Long Strangle Vs Short Call Butterfly | |
| Bear Call Spread Vs Short Call | Long Strangle Vs Bear Call Spread | |
| Bear Call Spread Vs Bear Put Spread | Long Strangle Vs Bear Put Spread | |
| Bear Call Spread Vs Bull Call Spread | Long Strangle Vs Bull Call Spread | |
| Bear Call Spread Vs Bull Put Spread | Long Strangle Vs Bull Put Spread |
Thus, with this, we wrap up our comparison of Bear Call Spread Vs Long Strangle option strategies.
As the name suggests, if you are looking at a slightly bearish market position and are open for a little risk, then bear call spread is something you can try in your trades. Having said that, the profit you can expect is going to be on a relatively limited level while using this strategy.
This needs to be known that the profit you get using this strategy is also limited in scope.
At the same time, if you are in a neutral market situation and are looking for unlimited profits from your share market trades, then you can opt to go for the Long Strangle strategy. Just remember, you need to be aware of the “right” strike prices for optimal gains.
Furthermore, as told above, it also depends on the market situation.
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