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 Bull Call Spread Vs Short Call Condor 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 Bull Call Spread Vs Short Call Condor 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 Bull Call Spread Vs Short Call Condor comparison:
Bull Call Spread is a vertical options strategy that involves buying and selling two option contracts simultaneously, both with the same underlying security and expiry, but different strike prices...more
Short Call Condor works in a neutral market and helps the trader to be unaffected by the direction of the trend. The profits can be earned irrespective of the direction in which the prices move...more
Investor Obligation
It involves buying and selling two option contracts simultaneously, both with the same underlying security and expiry, but different strike prices.
In case of limited price movement, the trader supposedlly incurs a loss.
Market Position
Moderately Bullish
Neutral
Strategy Level Suitable for
Beginners
Intermediates
Options Traded
Call
Call
Number of Positions
2
4
Action Needed
1 ATM Call, 1 OTM Call
1 Short ITM Call, 1 Long ITM Call, 1 Long OTM Call, 1 Short OTM Call
Risk for You
Limited
Limited
Profit Potential
Limited
Limited
Break Even Point for Investor
Strike price of Purchased Call + Net premium paid
Lower Breakeven = Lower Strike Price + Net Premium Upper breakeven = Higher Strike Price - Net Premium
Investor Intention
Let Options Expire Worthlessly
Let Options Expire Worthlessly
Investor Expectation
Prices of the securities to Go Up moderately
High Implied Volatility
Strategy Summary
Safe Play
Almost a Hero (Limited Profit)
Advantages
Limited Risk
Low Risk, Low Initial Capital, Profit Chances High
Thus, with this, we wrap up our comparison on Bull Call Spread Vs Short Call Condor option strategies.
However, if you are in a neutral market situation and have a limited risk appetite, then Short Call Condor may suit you well. You need to know that this strategy provides limited level profit only.
If you are in a moderately bullish market set-up and have a limited market risk appetite then you make consider using the Bull Call Spread strategy in your trades.
To add to that, the profit you get using this strategy is also limited in scope.
Furthermore, as told above, it also depends on the market situation.
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