LONG PUT BUTTERFLY	PROTECTIVE COLLAR
About Strategy	Long Put Butterfly Option Strategy  The Long Put Butterfly is a neutral strategy where a trader will be bearish on the volatility i.e. he thinks the market will have sideways kind of movement and will not rally sharply in either direction in the near future. This strategy involves sale of 2 ATM Put Options, buy 1 ITM and 1 OTM Put Option. The risk and reward are limited. Read more..	Protective Collar Strategy This Strategy is implemented when the investor requires downside protection for the short - to medium term but at lower cost. Buying protective puts can be an expensive proposition and writing OTM calls can defray the cost of the puts quite substantially. Protective Collar is considered as bearish to neutral strategy. In this strategy risk and reward is both are limited. This .. Read more..

LONG PUT BUTTERFLY Vs PROTECTIVE COLLAR - Details

	LONG PUT BUTTERFLY	PROTECTIVE COLLAR
Market View	Neutral	Neutral
Type (CE/PE)	PE (Put Option)	CE (Call Option) + PE (Put Option)
Number Of Positions	4	2
Strategy Level	Advance	Beginners
Reward Profile	Limited	Limited
Risk Profile	Limited	Limited
Breakeven Point	Upper Breakeven Point = Strike Price of Highest Strike Long Put - Net Premium Paid, Lower Breakeven Point = Strike Price of Lowest Strike Long Put + Net Premium Paid	Purchase Price of Underlying + Net Premium Paid

LONG PUT BUTTERFLY Vs PROTECTIVE COLLAR - When & How to use ?

	LONG PUT BUTTERFLY	PROTECTIVE COLLAR
Market View	Neutral	Neutral
When to use?	The Long Put Butterfly is a neutral strategy where a trader will be bearish on the volatility i.e. he thinks the market will have sideways kind of movement and will not rally sharply in either direction in the near future.	This Strategy is implemented when the investor requires downside protection for the short - to medium term but at lower cost.
Action	Buy 1 OTM Put, Sell 2 ATM Puts, Buy 1 ITM Put	• Short 1 Call Option, • Long 1 Put Option
Breakeven Point	Upper Breakeven Point = Strike Price of Highest Strike Long Put - Net Premium Paid, Lower Breakeven Point = Strike Price of Lowest Strike Long Put + Net Premium Paid	Purchase Price of Underlying + Net Premium Paid

LONG PUT BUTTERFLY Vs PROTECTIVE COLLAR - Risk & Reward

	LONG PUT BUTTERFLY	PROTECTIVE COLLAR
Maximum Profit Scenario	Strike Price of Higher Strike Long Put - Strike Price of Short Put - Net Premium Paid - Commissions Paid	• Call strike - stock purchase price - net premium paid + net credit received
Maximum Loss Scenario	When Price of Underlying <= Strike Price of Lower Strike Long Put OR Price of Underlying >= Strike Price of Higher Strike Long Put	• Stock purchase price - put strike - net premium paid - put strike + net credit received
Risk	Limited	Limited
Reward	Limited	Limited

LONG PUT BUTTERFLY Vs PROTECTIVE COLLAR - Strategy Pros & Cons

	LONG PUT BUTTERFLY	PROTECTIVE COLLAR
Similar Strategies	Iron Condors, Iron Butterfly	Bull Put Spread, Bull Call Spread
Disadvantage	• Risk is higher than reward. • When the underlying price is in between the two breakeven points, time decay hurts the position.	• Potential profit is lower or limited.
Advantages	• Limited maximum loss. • Unlimited profit potential, risk only limited to loss of premium. • Benefits from low volatility.	The Risk is limited.