LONG PUT BUTTERFLY	PROTECTIVE PUT
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 Put Option Strategy Protective Put Strategy is a hedging strategy where trader guards himself from the downside risk. This strategy is adopted when a trader is long on the underlying asset but skeptical of the downside. He will buy one ATM Put Option to hedge his position. Now, if the underlying asset moves either up or down, the trader is in a safe position. Read more..

LONG PUT BUTTERFLY Vs PROTECTIVE PUT - Details

	LONG PUT BUTTERFLY	PROTECTIVE PUT
Market View	Neutral	Bullish
Type (CE/PE)	PE (Put Option)	PE (Put Option)
Number Of Positions	4	1
Strategy Level	Advance	Beginners
Reward Profile	Limited	Unlimited
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 + Premium Paid

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

	LONG PUT BUTTERFLY	PROTECTIVE PUT
Market View	Neutral	Bullish
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 adopted when a trader is long on the underlying asset but skeptical of the downside.
Action	Buy 1 OTM Put, Sell 2 ATM Puts, Buy 1 ITM Put	Buy 1 ATM Put
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 + Premium Paid

LONG PUT BUTTERFLY Vs PROTECTIVE PUT - Risk & Reward

	LONG PUT BUTTERFLY	PROTECTIVE PUT
Maximum Profit Scenario	Strike Price of Higher Strike Long Put - Strike Price of Short Put - Net Premium Paid - Commissions Paid	Price of Underlying - Purchase Price of Underlying - Premium Paid
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	Premium Paid + Purchase Price of Underlying - Put Strike + Commissions Paid
Risk	Limited	Limited
Reward	Limited	Unlimited

LONG PUT BUTTERFLY Vs PROTECTIVE PUT - Strategy Pros & Cons

	LONG PUT BUTTERFLY	PROTECTIVE PUT
Similar Strategies	Iron Condors, Iron Butterfly	Long Call, Call Backspread
Disadvantage	• Risk is higher than reward. • When the underlying price is in between the two breakeven points, time decay hurts the position.	• Value of protective put position decreases as time passes • Holding period of the protective put can be affected by the timing as a result tax rate on the profit or loss from the stock can be affected.
Advantages	• Limited maximum loss. • Unlimited profit potential, risk only limited to loss of premium. • Benefits from low volatility.	• Unlimited potential profit due to indefinitely rise in the underlying stock price . • This strategy allows you to hold on to your stocks while insuring against losses. • Hedging strategy, trader can guard himself from the downside risk.