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 Call Vs Bear 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 Call Vs Bear 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 Call Vs Bear Call Spread comparison:
| Comparison Aspect | Short Call | Bear Call Spread |
| View |  |  |
| Strategy Introduction | Short Call is used when the trader expects that the price of the underlying asset will go down sharply, he shorts a call. If the price of the asset goes down, the strategy generates profit. However, if the price...more | The bear call spread consists of two calls, both with the same underlying asset and expiration date, but the strike price of the call options bought is less than the strike price of the same number of call options sold. Like most of the spread strategies, it is a limited-risk...more |
| Investor Obligation | The trader has the obligation to buy the stock at the predetermined price at the time of expiration. | As a thumb rule, the expiration date must be about 30-45 days away in order to be able to take advantage of the accelerating time decay. |
| Market Position | Bearish | Moderately Bearish |
| Strategy Level Suitable for | Experts | Intermediates |
| Options Traded | Call | Call |
| Number of Positions | 1 | 2 |
| Action Needed | Sell Call Option | Buy OTM Call, Sell OTM Call |
| Risk for You | Unlimited | Limited |
| Profit Potential | Limited | Limited |
| Break Even Point for Investor | Strike Price PLUS Premium | Strike Price of Short Call + Net Premium Received |
| Investor Intention | Let Options Expire Worthlessly | Let Options Expire Worthlessly |
| Investor Expectation | Prices of Assets Go Down Sharply | Market to go down gradually, but moderately |
| Strategy Summary | Risky | Limited Risk Limited Profit |
| Advantages | Profits in Bearish Market | Profit when Market is going down, Limited Risk |
| Disadvantages | Limited Profit, Unlimited Risk | Limited Profit |
| Market Scenarios - Profit | 1 | 2 |
| Market Scenarios - Loss | 1 | 1 |
| Also called as | Naked Call, Uncovered Call | NA |
| More Comparisons | Short Call Vs Short Put | Bear Call Spread Vs Short Put |
| Short Call Vs Long Combo | Bear Call Spread Vs Long Combo | |
| Short Call Vs Synthetic Call | Bear Call Spread Vs Synthetic Call | |
| Short Call Vs Long Put | Bear Call Spread Vs Long Put | |
| Short Call Vs Long Call | Bear Call Spread Vs Long Call | |
| Short Call Vs Covered Call | Bear Call Spread Vs Covered Call | |
| Short Call Vs Covered Put | Bear Call Spread Vs Covered Put | |
| Short Call Vs Protective Call | Bear Call Spread Vs Protective Call | |
| Short Call Vs Short Box | Bear Call Spread Vs Short Box | |
| Short Call Vs Long Call Condor | Bear Call Spread Vs Long Call Condor | |
| Short Call Vs Short Call Condor | Bear Call Spread Vs Short Call Condor | |
| Short Call Vs Box Spread | Bear Call Spread Vs Box Spread | |
| Short Call Vs Short Strangle | Bear Call Spread Vs Short Strangle | |
| Short Call Vs Long Strangle | Bear Call Spread Vs Long Strangle | |
| Short Call Vs Collar Strategy | Bear Call Spread Vs Collar Strategy | |
| Short Call Vs Long Straddle | Bear Call Spread Vs Long Straddle | |
| Short Call Vs Short Straddle | Bear Call Spread Vs Short Straddle | |
| Short Call Vs Long Call Butterfly | Bear Call Spread Vs Long Call Butterfly | |
| Short Call Vs Short Call Butterfly | Bear Call Spread Vs Short Call Butterfly | |
| Short Call Vs Bear Call Spread | Bear Call Spread Vs Short Call | |
| Short Call Vs Bear Put Spread | Bear Call Spread Vs Bear Put Spread | |
| Short Call Vs Bull Call Spread | Bear Call Spread Vs Bull Call Spread | |
| Short Call Vs Bull Put Spread | Bear Call Spread Vs Bull Put Spread |
Thus, with this, we wrap up our comparison on Short Call Vs Bear Call Spread option strategies.
As mentioned above, if you are looking to put minimal initial investment and have a high-risk appetite, then Short Call options strategy can work wonders for you.
As the name suggests, if you are looking at a slightly bearish market position and are open for a little risk, then bear call spread is something you can try in your trades. Having said that, the profit you can expect is going to be on a relatively limited level while using this strategy.
This needs to be known that the profit you get using this strategy is also limited in scope.
Furthermore, as said above, it also depends on the market situation.
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