Synthetic Long¶
A synthetic long is a two-leg options position that replicates the payoff of owning 100 shares of stock. It is built by buying one call and selling one put at the same strike price and expiration date. The net delta is approximately +1.00, so the position moves dollar-for-dollar with the underlying, grounded in the principle of put-call parity.
HOW IT WORKS¶
The position is constructed with two legs at the same strike K and expiration T: buy one call, sell one put. The net premium equals the call premium minus the put premium. A positive result is a net debit; a negative result is a net credit. Breakeven at expiration is the strike plus the net debit paid (or minus the net credit received). Profit is unlimited to the upside; maximum loss occurs if the stock falls to zero and equals the strike minus any net credit received. The short put carries assignment risk — if the put moves in-the-money, early assignment converts the position into long stock and may require additional capital.
IN TAPEBOARD¶
Tapeboard displays synthetic long positions as a combined two-leg structure in the position panel, with net delta, net premium, and breakeven calculated automatically. The risk graph overlays the synthetic payoff against the equivalent stock position so traders can compare capital efficiency at a glance. Margin requirements for the short put leg update in real time as the underlying moves, and Tapeboard flags early assignment risk when the short put crosses in-the-money.