Gain exposure to the price movements of a particular stock without actually shorting the stock Alias Short Combination, Combo Strip Descriptions An investor who is synthetically short a stock will typically hold a short call option and a long put option on that stock with the same expiration date and strike price. The net effect […]

A synthetic put is a financial derivative that combines a call option and a short position in the underlying asset to replicate the payout of a traditional put option. Description The call option has a strike price that is below the current market price of the underlying asset, while the short position in the underlying […]

Gain exposure to the price movements of a particular stock without actually owning the stock Descriptions Synthetic long stock is a financial instrument that allows an investor to gain exposure to the price movements of a particular stock without actually owning the stock. This can be achieved through the use of derivatives such as options […]

A synthetic call is a financial derivative that combines a put option and a call option to replicate the payout of a traditional call option. Description The put option has a strike price that is below the current market price of the underlying asset, while the call option has a strike price that is above […]

Similar to a straddle but with a stronger bearish bias achieved by purchasing twice as many puts. The stock must move in order to generate money, but it will now profit more from a downward movement than from an upward one. Description If the price of the underlying security falls significantly, the value of the […]