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 Short Put Vs Bull Call 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 Short Put Vs Bull Call 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 Short Put Vs Bull Call Spread comparison:
| Comparison Aspect | Bull Call Spread | Short Put |
| 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 | The short put strategy is used when the investor is bullish towards the market and expects the prices to go up. He then sells the put option and makes a profit if...more |
| Investor Obligation | It involves buying and selling two option contracts simultaneously, both with the same underlying security and expiry, but different strike prices. | Investor is obligated to sell the shares at the predetermined price, at the time of expiry, if the buyer of the put option chooses to exercise his option. |
| Market Position | Moderately Bullish | Bullish |
| Strategy Level Suitable for | Beginners | Beginners |
| Options Traded | Call | Put |
| Number of Positions | 2 | 1 |
| Action Needed | 1 ATM Call, 1 OTM Call | Sell Put Option |
| Risk for You | Limited | Unlimited |
| Profit Potential | Limited | Limited |
| Break Even Point for Investor | Strike price of Purchased Call + Net premium paid | Strike Price MINUS Premium |
| Investor Intention | Let Options Expire Worthlessly | Let Options Expire Worthlessly |
| Investor Expectation | Prices of the securities to Go Up moderately | Prices go up sharply |
| Strategy Summary | Safe Play | Complex & Risky |
| Advantages | Limited Risk | Steady source of income till market remains bullish |
| Disadvantages | Capped Profit | High Risk, Limited Profit |
| Market Scenarios - Profit | 3 | 1 |
| Market Scenarios - Loss | 2 | 2 |
| Also called as | NA | Naked Put or Uncovered Put |
| More Comparisons | Bull Call Spread Vs Short Put | Short Put Vs Long Put |
| Bull Call Spread Vs Long Combo | Short Put Vs Long Combo | |
| Bull Call Spread Vs Synthetic Call | Short Put Vs Synthetic Call | |
| Bull Call Spread Vs Long Put | Short Put Vs Short Call | |
| Bull Call Spread Vs Long Call | Short Put Vs Long Call | |
| Bull Call Spread Vs Covered Call | Short Put Vs Covered Call | |
| Bull Call Spread Vs Covered Put | Short Put Vs Covered Put | |
| Bull Call Spread Vs Protective Call | Short Put Vs Protective Call | |
| Bull Call Spread Vs Short Box | Short Put Vs Short Box | |
| Bull Call Spread Vs Long Call Condor | Short Put Vs Long Call Condor | |
| Bull Call Spread Vs Short Call Condor | Short Put Vs Short Call Condor | |
| Bull Call Spread Vs Box Spread | Short Put Vs Box Spread | |
| Bull Call Spread Vs Short Strangle | Short Put Vs Short Strangle | |
| Bull Call Spread Vs Long Strangle | Short Put Vs Long Strangle | |
| Bull Call Spread Vs Collar Strategy | Short Put Vs Collar Strategy | |
| Bull Call Spread Vs Long Straddle | Short Put Vs Long Straddle | |
| Bull Call Spread Vs Short Straddle | Short Put Vs Short Straddle | |
| Bull Call Spread Vs Long Call Butterfly | Short Put Vs Long Call Butterfly | |
| Bull Call Spread Vs Short Call Butterfly | Short Put Vs Short Call Butterfly | |
| Bull Call Spread Vs Bear Call Spread | Short Put Vs Bear Call Spread | |
| Bull Call Spread Vs Bear Put Spread | Short Put Vs Bear Put Spread | |
| Bull Call Spread Vs Short Call | Short Put Vs Bull Call Spread | |
| Bull Call Spread Vs Bull Put Spread | Short Put Vs Bull Put Spread |
Thus, with this, we wrap up our comparison on Short Put Vs Bull Call Spread option strategies.
As mentioned above, 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. The profit you get using this strategy is also limited in scope.
However, if your risk appetite is relatively high – then you can try Short Put although the profit potential in that strategy is limited.
Furthermore, as said 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.
