Successful option traders build positions to exploit current market conditions. For example, if you have a slightly bullish forecast, you could put on a debit spread by purchasing a call and selling a cheaper call to offset its cost. Or, you could buy the underlying and sell a call against it (a covered call). But which strategy should you choose?

Comparing four types of option spreads that consist of a short call and a long call (or its equivalent) for protection will help answer this question. If you can gauge which positions tend to perform best in bearish, high-volatility markets, you can profit while others panic.