SHORT STRANGLE	SHORT PUT BUTTERFLY
About Strategy	Short Strangle Option Strategy  This strategy is similar to Short Straddle; the only difference is of the strike prices at which the positions are built. Short Strangle involves selling of one OTM Call Option and selling of one OTM Put Option, of the same expiry date and same underlying asset. Here the probability of making profits is more as there is a spread between the two strike prices, and if Read more..	Short Put Butterfly Option Strategy  In Short Put Butterfly strategy, a trader is neutral in nature and expects the market to remain range bound in the near future. A trader will buy 2 ATM Put Options; sell 1 ITM & 1 OTM Put Options. Here risk and returns both are limited. Risk:< .. Read more..

SHORT STRANGLE Vs SHORT PUT BUTTERFLY - Details

	SHORT STRANGLE	SHORT PUT BUTTERFLY
Market View	Neutral	Neutral
Type (CE/PE)	CE (Call Option) + PE (Put Option)	PE (Put Option)
Number Of Positions	2	4
Strategy Level	Advance	Advance
Reward Profile	Limited	Limited
Risk Profile	Unlimited	Limited
Breakeven Point	Lower Break-even = Strike Price of Put - Net Premium, Upper Break-even = Strike Price of Call+ Net Premium	Upper Breakeven Point = Strike Price of Highest Strike Short Put - Net Premium Received, Lower Breakeven Point = Strike Price of Lowest Strike Short Put + Net Premium Received

SHORT STRANGLE Vs SHORT PUT BUTTERFLY - When & How to use ?

	SHORT STRANGLE	SHORT PUT BUTTERFLY
Market View	Neutral	Neutral
When to use?	This strategy is perfect in a neutral market scenario when the underlying is expected to be less volatile.	In Short Put Butterfly strategy, a trader is neutral in nature and expects the market to remain range bound in the near future.
Action	Sell OTM Call, Sell OTM Put	Sell 1 ITM Put, Buy 2 ATM Put, Sell 1 OTM Put
Breakeven Point	Lower Break-even = Strike Price of Put - Net Premium, Upper Break-even = Strike Price of Call+ Net Premium	Upper Breakeven Point = Strike Price of Highest Strike Short Put - Net Premium Received, Lower Breakeven Point = Strike Price of Lowest Strike Short Put + Net Premium Received

SHORT STRANGLE Vs SHORT PUT BUTTERFLY - Risk & Reward

	SHORT STRANGLE	SHORT PUT BUTTERFLY
Maximum Profit Scenario	Maximum Profit = Net Premium Received	Net Premium Received - Commissions Paid
Maximum Loss Scenario	Loss = Price of Underlying - Strike Price of Short Call - Net Premium Received	Strike Price of Higher Strike Short Put - Strike Price of Long Put - Net Premium Received + Commissions Paid
Risk	Unlimited	Limited
Reward	Limited	Limited

SHORT STRANGLE Vs SHORT PUT BUTTERFLY - Strategy Pros & Cons

	SHORT STRANGLE	SHORT PUT BUTTERFLY
Similar Strategies	Short Straddle, Long Strangle	Short Condor, Reverse Iron Condor
Disadvantage	• Unlimited loss is associated with this strategy, not recommended for beginners. • Limited reward amount.	• High risk strategy and may cause huge losses if the price of the underlying stocks falls steeply. • Higher profit is only possible when shares get close to expiration.
Advantages	• Higher chance of profitability due to selling of OTM options. • Advantage from double time decay and a contraction in volatility. • Traders can book profit when underlying asset stays within a tight trading range.	• Benefits from time decay. • Traders can earn more in a rising or range bound scenario. • Benefits from a surge in volatility.