Bullish Patterns
Long Calls
Bull Call Spread
Bull Put Spread
Call Backspread
Long Call Ratio Spread
Naked Put
Synthetic Long Stock
The Collar
Covered Calls
Synthetic Long Call
Synthetic Short Put
Covered Straddle
Covered Strangle
Married Put
Protective Put

Bearish Patterns
Long Puts
Bear Put Spread
Bear Call Spread
Put Backspread
Long Put Ratio Spread
Naked Calls
Synthetic Short Stock
Synthetic Short Stock (split strikes)
Covered Put
Protective Call
Synthetic Short Call
Synthetic Long Put

Long Volatility
Long Straddle
Long Strangle
Short Call Butterfly
Short Put Butterfly
Short Iron Butterfly
Short Call Condor
Short Put Condor
Short Iron Condor
Long Guts
Short Call Ladder
Short Put Ladder
Long Call Synthetic Straddle
Long Put Synthetic Straddle

Short Volatility
Short Straddle
Short Strangle
Long Call Butterfly
Long Put Butterfly
Long Iron Butterfly
Long Call Condor
Long Put Condor
Long Iron Condor
Short Guts
Long Call Ladder
Long Put Ladder
Call Ratio Spread
Short Call Ratio Spread
Put Ratio Spread
Short Put Ratio Spread
Ratio Call Write
Ratio Put Write
Short Call Synthetic Straddle
Short Put Synthetic Straddle
Variable Ratio Write

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Synthetic Short Put

Risk: unlimited
Reward: limited

General Description
Entering a synthetic short put entails selling calls on a stock you own. It has the same risk profile as a naked put (short put) (hence why it's considered a synthetic short put), but it's actually just a covered call.

(draw a synthetic short put risk diagram here)

The Thinking
You want the benefits of stock ownership (collecting dividends, potential price appreciation), but you want some downside protection.

XYZ is at $51. You’re confident a move down is very unlikely and the upside is limited. You wish to employ a strategy that profits from flat-ish movement and prefer a strategy that benefits from time decay. Also, you don’t necessary want or need to keep the stock. You buy 100 shares at $51.00 and then sell (1) 50 call for $4.00.

If the stock drops below $50.00, you'll keep the stock and the call premium collected.

If the stock closes above $50.00, you'll still keep the premium collected, but the stock will get “called” from you.

The shape of the P&L curve is identical to a short put (hence the name, synthetic short put), but this is really just a covered call.

The PL chart below graphically shows where this trade will be profitable and at a loss.