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 Long Combo Vs Box Spread 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 Long Combo Vs Box Spread 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 Long Combo Vs Box Spread comparison:
| Comparison Aspect | Long Combo | Box Spread |
| View |  |  |
| Strategy Introduction | The long combo is used when the investor is bullish towards the market and is certain that the prices of the shares will go up...more | Box Spread is an arbitrage strategy in which two complementary positions are taken that balance out the risk of each other. This makes the box spread an almost risk-free strategy...more |
| Investor Obligation | The strategy expects low initial investment, however, the trader needs to pay the premium on the trades irrespective of the trade result. | The trader has the obligation to keep the positions open till they reach their respective expirations. |
| Market Position | Bullish | Neutral |
| Strategy Level Suitable for | Intermediates | Intermediates |
| Options Traded | Put, Call | Call, Put |
| Number of Positions | 2 | 4 |
| Action Needed | Sell One OTM Put, Buy One OTM Call | 1 Long ITM Call, 1 Short OTM Call, 1 Long ITM Put, 1 Short OTM Put |
| Risk for You | Unlimited | None |
| Profit Potential | Unlimited | Limited |
| Break Even Point for Investor | Call Strike + Net Premium | NA |
| Investor Intention | Low Upfront Investments, High ROI | Choose the Correct Stike Prices |
| Investor Expectation | Price of Stocks Go Up | Short-term demand shifts of the options in the market. |
| Strategy Summary | Complex | Complicated |
| Advantages | Low Upfront Investment, Unlimited Profits | Risk Free, Direction Neutral |
| Disadvantages | Unlimited Loss, High Premium | Limited Profit, High Margin Maintenance, Positions cannot be closed before expiry. |
| Market Scenarios - Profit | 1 | 2 |
| Market Scenarios - Loss | 1 | 0 |
| Also called as | NA | NA |
| More Comparisons | Long Combo Vs Short Put | Box Spread Vs Short Put |
| Long Combo Vs Long Put | Box Spread Vs Long Combo | |
| Long Combo Vs Synthetic Call | Box Spread Vs Synthetic Call | |
| Long Combo Vs Short Call | Box Spread Vs Long Put | |
| Long Combo Vs Long Call | Box Spread Vs Long Call | |
| Long Combo Vs Covered Call | Box Spread Vs Covered Call | |
| Long Combo Vs Covered Put | Box Spread Vs Covered Put | |
| Long Combo Vs Protective Call | Box Spread Vs Protective Call | |
| Long Combo Vs Short Box | Box Spread Vs Short Box | |
| Long Combo Vs Long Call Condor | Box Spread Vs Long Call Condor | |
| Long Combo Vs Short Call Condor | Box Spread Vs Short Call Condor | |
| Long Combo Vs Box Spread | Box Spread Vs Short Call | |
| Long Combo Vs Short Strangle | Box Spread Vs Short Strangle | |
| Long Combo Vs Long Strangle | Box Spread Vs Long Strangle | |
| Long Combo Vs Collar Strategy | Box Spread Vs Collar Strategy | |
| Long Combo Vs Long Straddle | Box Spread Vs Long Straddle | |
| Long Combo Vs Short Straddle | Box Spread Vs Short Straddle | |
| Long Combo Vs Long Call Butterfly | Box Spread Vs Long Call Butterfly | |
| Long Combo Vs Short Call Butterfly | Box Spread Vs Short Call Butterfly | |
| Long Combo Vs Bear Call Spread | Box Spread Vs Bear Call Spread | |
| Long Combo Vs Bear Put Spread | Box Spread Vs Bear Put Spread | |
| Long Combo Vs Bull Call Spread | Box Spread Vs Bull Call Spread | |
| Long Combo Vs Bull Put Spread | Box Spread Vs Bull Put Spread |
Thus, with this, we wrap up our comparison on Long Combo Vs Box Spread option strategies.
At the same time, if you are in a neutral market situation and are looking for consistent but limited profits for your share market trades, then you can opt to go for the Box spread strategy.
The strategy comes with a limited profit potential.
If you are looking to put minimal initial investment and are open for unlimited profits as well as risks, then Long Combo options strategy can work wonders for you.
In case you are looking to trade in options segment or share market in general, let us assist you in that. Just fill the form below and we will take you to the steps ahead.
