Long Call to Protect Short Futures

What this video covers

• Why a naked short futures position carries unlimited upside risk and which specific option caps that risk at a defined strike
• How buying a long call at or near the futures level converts unlimited loss into a ceiling, with the premium as the fixed insurance cost
• Why short futures plus a long call equals a synthetic long put, and why calling it a synthetic long call inverts the bearish market view
• The complete synthetic map: short futures plus long call, long futures plus long put, and long futures plus short call (covered call)
• How to use the memory aid, a short fears the rally up so it buys a call as a ceiling, to instantly eliminate flipped answer choices
• Why adding a put to a short future doubles down on the bearish side instead of capping risk, and how to spot this exam trap
• How put-call parity, long call plus short put equals long future, lets you algebraically derive any synthetic from the other two legs