SHORT CALL BUTTERFLY	COVERED PUT
About Strategy	Short Call Butterfly Option Strategy This strategy is opposite of the Long Call Butterfly Strategy, a trader expects the market to remain range bound in Long Call Butterfly, but here he expects the market to move beyond strike boundaries in Short Call Butterfly. If the trader is bullish on the market’s volatility, he will implement this strategy. Here also there should be equal distance between the Read more..	Covered Put Option Strategy  This strategy is exactly opposite to Covered Call Strategy. Here the investor is neutral or moderately bearish in nature and wants to take advantage of the price fall in the near future. The trader will short one lot of stock future. Now the trader will short ATM Put Option, the option strike price will be his exit price. If the prices rally above the strike price, the .. Read more..

SHORT CALL BUTTERFLY Vs COVERED PUT - Details

	SHORT CALL BUTTERFLY	COVERED PUT
Market View	Neutral	Bearish
Type (CE/PE)	CE (Call Option)	PE (Put Option) + Underlying
Number Of Positions	4	2
Strategy Level	Advance	Advance
Reward Profile	Limited	Limited
Risk Profile	Limited	Unlimited
Breakeven Point	Lower Break-even = Lower Strike Price + Net Premium, Upper Break-even = Higher Strike Price - Net Premium	Futures Price + Premium Received

SHORT CALL BUTTERFLY Vs COVERED PUT - When & How to use ?

	SHORT CALL BUTTERFLY	COVERED PUT
Market View	Neutral	Bearish
When to use?	This strategy is meant for special scenarios where you foresee a lot of volatility in the market due to election results, budget, policy change, annual result announcements etc.	The Covered Put works well when the market is moderately Bearish.
Action	Buy 2 ATM Call, Sell 1 ITM Call, Sell 1 OTM Call	Sell Underlying Sell OTM Put Option
Breakeven Point	Lower Break-even = Lower Strike Price + Net Premium, Upper Break-even = Higher Strike Price - Net Premium	Futures Price + Premium Received

SHORT CALL BUTTERFLY Vs COVERED PUT - Risk & Reward

	SHORT CALL BUTTERFLY	COVERED PUT
Maximum Profit Scenario	The profit is limited to the net premium received.	The profit happens when the price of the underlying moves above strike price of Short Put.
Maximum Loss Scenario	Higher strike price- Lower Strike Price - Net Premium	Price of Underlying - Sale Price of Underlying - Premium Received
Risk	Limited	Unlimited
Reward	Limited	Limited

SHORT CALL BUTTERFLY Vs COVERED PUT - Strategy Pros & Cons

	SHORT CALL BUTTERFLY	COVERED PUT
Similar Strategies	Long Straddle, Long Call Butterfly	Bear Put Spread, Bear Call Spread
Disadvantage	• Limited rewards, usually offer smaller return. • Profitability depends on the significant movement of stocks and options prices.	• Limited profit, unlimited risk. • Trader should have enough experience before using this strategy.
Advantages	• Even if the market is highly volatile, the risk exposure remains limited. • Without any extra investment, you can receive your premium. • Able to book profits even when the price movement cannot be predicted.	• Investors can book profit when underlying stock price drop, move sideways or rises by a small amount. • Able to generate monthly income. • Able to generate profit from fall in prices or mild increase in the prices.