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 Synthetic Call 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 Synthetic Call 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 Synthetic Call comparison:
| Comparison Aspect | Bull Call Spread | Synthetic Call |
| View |  |  |
| Strategy Introduction | 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 | Synthetic Call is an options strategy in which an underlying asset is combined with a put option to protect against depreciation in the value of the underlying asset. The overall effect is similar to...more |
| Investor Obligation | It involves buying and selling two option contracts simultaneously, both with the same underlying security and expiry, but different strike prices. | Stay with the position |
| Market Position | Moderately Bullish | Bullish |
| Strategy Level Suitable for | Beginners | Beginners |
| Options Traded | Call | Put |
| Number of Positions | 2 | 2 (Underlying + Put) |
| Action Needed | 1 ATM Call, 1 OTM Call | Holds a long position in an underlying asset and a put option on the same stock |
| Risk for You | Limited | Limited |
| Profit Potential | Limited | Unlimited |
| Break Even Point for Investor | Strike price of Purchased Call + Net premium paid | Underlying Price + Put Premium |
| Investor Intention | Let Options Expire Worthlessly | Save Transaction Costs, Stay Protected from downward market movement. |
| Investor Expectation | Prices of the securities to Go Up moderately | Prices of the Assets to Go Up |
| Strategy Summary | Safe Play | Profitable |
| Advantages | Limited Risk | Dividends on Stocks, Limited Risk, Unlimited Profit |
| Disadvantages | Capped Profit | Chances of loss if the underlying goes down |
| Market Scenarios - Profit | 3 | 1 |
| Market Scenarios - Loss | 2 | 1 |
| Also called as | NA | NA |
| More Comparisons | Bull Call Spread Vs Short Put | Synthetic Call Vs Short Put |
| Bull Call Spread Vs Long Combo | Synthetic Call Vs Long Combo | |
| Bull Call Spread Vs Synthetic Call | Synthetic Call Vs Short Call | |
| Bull Call Spread Vs Long Put | Synthetic Call Vs Long Put | |
| Bull Call Spread Vs Long Call | Synthetic Call Vs Long Call | |
| Bull Call Spread Vs Covered Call | Synthetic Call Vs Covered Call | |
| Bull Call Spread Vs Covered Put | Synthetic Call Vs Covered Put | |
| Bull Call Spread Vs Protective Call | Synthetic Call Vs Protective Call | |
| Bull Call Spread Vs Short Box | Synthetic Call Vs Short Box | |
| Bull Call Spread Vs Long Call Condor | Synthetic Call Vs Long Call Condor | |
| Bull Call Spread Vs Short Call Condor | Synthetic Call Vs Short Call Condor | |
| Bull Call Spread Vs Box Spread | Synthetic Call Vs Box Spread | |
| Bull Call Spread Vs Short Strangle | Synthetic Call Vs Short Strangle | |
| Bull Call Spread Vs Long Strangle | Synthetic Call Vs Long Strangle | |
| Bull Call Spread Vs Collar Strategy | Synthetic Call Vs Collar Strategy | |
| Bull Call Spread Vs Long Straddle | Synthetic Call Vs Long Straddle | |
| Bull Call Spread Vs Short Straddle | Synthetic Call Vs Short Straddle | |
| Bull Call Spread Vs Long Call Butterfly | Synthetic Call Vs Long Call Butterfly | |
| Bull Call Spread Vs Short Call Butterfly | Synthetic Call Vs Short Call Butterfly | |
| Bull Call Spread Vs Bear Call Spread | Synthetic Call Vs Bear Call Spread | |
| Bull Call Spread Vs Bear Put Spread | Synthetic Call Vs Bear Put Spread | |
| Bull Call Spread Vs Short Call | Synthetic Call Vs Bull Call Spread | |
| Bull Call Spread Vs Bull Put Spread | Synthetic Call Vs Bull Put Spread |
Thus, with this, we wrap up our comparison on Bull Call Spread Vs Synthetic Call option strategies.
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.
If you are looking at a bearish market momentum and are open towards a limited risk with a potential of unlimited profits, then Synthetic Call options strategy is definitely a positive go for you.
Be aware of all the related aspects (like the ones listed above) and then make a choice for yourself.
Furthermore, as told above, it also depends on the market situation.
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