: Used by investors who are bullish but want a "margin of error" before the put obligation kicks in. Key Risks to Consider
: Replicate 100 shares of stock performance with minimal upfront cost. sell put and buy call strategy
The strategy of is known as a Synthetic Long Stock position when both options have the same strike price, or a Risk Reversal when they have different strike prices. This strategy mimics the risk and reward profile of owning the underlying stock but with significantly less capital. Core Papers and Resources : Used by investors who are bullish but
: The Synthetic Long Stock Guide by HKEX provides a structured breakdown of the investment costs, maturity constraints, and margin requirements. This strategy mimics the risk and reward profile
: Synthetic Long Stock and Option Trading: Evidence from Stock Splits examines how capital-constrained traders use this strategy to maintain market exposure.