Long Synthetic Future – When You Want Futures Power Without the Futures Contract

Long Synthetic Future – Futures-Like Exposure Using Options (Illustrative Example:

| July 2023 | Historical Price Reference) Market View Bullish. This strategy is used when you expect the underlying stock to move higher, similar to holding a long futures position. In this illustrative case, ALKEM was trading around ₹3500 in July 2023, and the expectation was for continued upside. The Trade (Illustrative | Hypothetical Premiums) • Buy ALKEM 3500 Call @ ₹120 • Sell ALKEM 3500 Put @ ₹120 Net Premium: 0 (Strikes and premiums are illustrative and used only to explain the concept.) Breakeven • Strike Price + Net Premium Paid • Strike Price - Net Premium Received 3500 in this example Max Profit • Unlimited • As ALKEM rises above breakeven, profits increase linearly Max Loss • Unlimited • Significant losses if ALKEM falls sharply below breakeven due to short put exposure Premium & Margin • Premium: Near zero / marginal • Margin: Required (because of sold put) Effect of Time & Volatility • Time decay impact is negligible as call theta and put theta largely offset • Effect of implied volatility is minimal Quick Logic Check (Important) • Payoff closely mimics a long futures position • Directional conviction must be strong • Risk is high if the stock moves sharply against the view 📌 Disclaimer: This content is for information only and not investment advice. Investments in securities market are subject to market risks. Read all the related documents carefully before investing. AI may have been used for grammatical and sentence-structure refinement. Please consult a SEBI-registered advisor before making any investment decisions.