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 Strangle 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 Long Strangle 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 Long Strangle Vs Synthetic Call comparison:
| Comparison Aspect | Long Strangle | Synthetic Call |
| View |  |  |
| Strategy Introduction | 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 | 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 is a trend neutral strategy, so the trader does not need to be certain of the direction of the price movement. | Stay with the position |
| Market Position | Neutral | Bullish |
| Strategy Level Suitable for | Intermediates | Beginners |
| Options Traded | Call, Put | Put |
| Number of Positions | 2 | 2 (Underlying + Put) |
| Action Needed | One OTM Put, One 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 | Unlimited | Unlimited |
| Break Even Point for Investor | Lower Breakeven Point = Strike Price of Put - Net Premium Upper Breakeven Point = Strike Price of Call + Net Premium | Underlying Price + Put Premium |
| Investor Intention | Both call and put options expire worthlessly | Save Transaction Costs, Stay Protected from downward market movement. |
| Investor Expectation | Market Shows High Volatility | Prices of the Assets to Go Up |
| Strategy Summary | Attractive | Profitable |
| Advantages | Less Expensive, Limited Risk, Unlimited Gain | Dividends on Stocks, Limited Risk, Unlimited Profit |
| Disadvantages | Price Movement has to be Big | Chances of loss if the underlying goes down |
| Market Scenarios - Profit | 2 | 1 |
| Market Scenarios - Loss | 1 | 1 |
| Also called as | NA | NA |
| More Comparisons | Long Strangle Vs Short Put | Synthetic Call Vs Short Put |
| Long Strangle Vs Long Combo | Synthetic Call Vs Long Combo | |
| Long Strangle Vs Synthetic Call | Synthetic Call Vs Short Call | |
| Long Strangle Vs Long Put | Synthetic Call Vs Long Put | |
| Long Strangle Vs Long Call | Synthetic Call Vs Long Call | |
| Long Strangle Vs Covered Call | Synthetic Call Vs Covered Call | |
| Long Strangle Vs Covered Put | Synthetic Call Vs Covered Put | |
| Long Strangle Vs Protective Call | Synthetic Call Vs Protective Call | |
| Long Strangle Vs Short Box | Synthetic Call Vs Short Box | |
| Long Strangle Vs Long Call Condor | Synthetic Call Vs Long Call Condor | |
| Long Strangle Vs Short Call Condor | Synthetic Call Vs Short Call Condor | |
| Long Strangle Vs Box Spread | Synthetic Call Vs Box Spread | |
| Long Strangle Vs Short Strangle | Synthetic Call Vs Short Strangle | |
| Long Strangle Vs Short Call | Synthetic Call Vs Long Strangle | |
| Long Strangle Vs Collar Strategy | Synthetic Call Vs Collar Strategy | |
| Long Strangle Vs Long Straddle | Synthetic Call Vs Long Straddle | |
| Long Strangle Vs Short Straddle | Synthetic Call Vs Short Straddle | |
| Long Strangle Vs Long Call Butterfly | Synthetic Call Vs Long Call Butterfly | |
| Long Strangle Vs Short Call Butterfly | Synthetic Call Vs Short Call Butterfly | |
| Long Strangle Vs Bear Call Spread | Synthetic Call Vs Bear Call Spread | |
| Long Strangle Vs Bear Put Spread | Synthetic Call Vs Bear Put Spread | |
| Long Strangle Vs Bull Call Spread | Synthetic Call Vs Bull Call Spread | |
| Long Strangle Vs Bull Put Spread | Synthetic Call Vs Bull Put Spread |
Thus, with this, we wrap up our comparison of Long Strangle Vs Synthetic Call option strategies.
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.
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.
Furthermore, as told above, it also depends on the market situation.
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.
