Part 4 Learn Institutional Trading

Protective Put

When to Use: To insure against downside.

Setup: Own stock + Buy put option.

Risk: Premium paid.

Reward: Stock can rise, but downside is protected.

Example: Own TCS at ₹3,000, buy 2,900 PE for ₹50.

Bull Call Spread

When to Use: Expect moderate rise.

Setup: Buy lower strike call + Sell higher strike call.

Risk: Limited.

Reward: Limited.

Example: Buy 20,000 CE @ ₹100, Sell 20,200 CE @ ₹50.

Bear Put Spread

When to Use: Expect moderate fall.

Setup: Buy higher strike put + Sell lower strike put.

Risk: Limited.

Reward: Limited.