RATIO PUT SPREAD	COVERED COMBINATION
About Strategy	Ratio Put Spread Option Strategy  This strategy involves buying ITM Puts and simultaneously selling OTM Puts, double the number of ITM Puts. This strategy is used by a trader who is neutral on the market and bearish on the volatility in the near future. Here profits will be capped up to the premium amount and risk will be potentially unlimited. Read more..	Covered Combination Option Strategy This strategy involves selling OTM Call & Put Options and buying the underlying asset in either cash or futures market. It is also known as Covered Strangle as the profits are capped and risk is potentially unlimited. Risk: Un .. Read more..

RATIO PUT SPREAD Vs COVERED COMBINATION - Details

	RATIO PUT SPREAD	COVERED COMBINATION
Market View	Neutral	Bullish
Type (CE/PE)	PE (Put Option)	CE (Call Option) + PE (Put Option)
Number Of Positions	3	2
Strategy Level	Beginners	Advance
Reward Profile	Limited	Limited
Risk Profile	Unlimited	Unlimited
Breakeven Point	Upper Breakeven Point = Strike Price of Long Put +/- Net Premium Received or Paid, Lower Breakeven Point = Strike Price of Short Puts - (Points of Maximum Profit / Number of Uncovered Puts)	(Purchase Price of Underlying + Strike Price of Short Put - Net Premium Received) / 2

RATIO PUT SPREAD Vs COVERED COMBINATION - When & How to use ?

	RATIO PUT SPREAD	COVERED COMBINATION
Market View	Neutral	Bullish
When to use?	This strategy is used by a trader who is neutral on the market and bearish on the volatility in the near future.	This strategy is mainly suited for investors who are moderately bullish on a stock and are comfortable with increasing their position in the event of a price decline.
Action	Buy 1 ITM Put, Sell 2 OTM Puts	Sell 1 OTM Call, Sell 1 OTM Put
Breakeven Point	Upper Breakeven Point = Strike Price of Long Put +/- Net Premium Received or Paid, Lower Breakeven Point = Strike Price of Short Puts - (Points of Maximum Profit / Number of Uncovered Puts)	(Purchase Price of Underlying + Strike Price of Short Put - Net Premium Received) / 2

RATIO PUT SPREAD Vs COVERED COMBINATION - Risk & Reward

	RATIO PUT SPREAD	COVERED COMBINATION
Maximum Profit Scenario	Strike Price of Long Put - Strike Price of Short Put + Net Premium Received - Commissions Paid	Strike Price of Short Call - Purchase Price of Underlying + Net Premium Received - Commissions Paid
Maximum Loss Scenario	Strike Price of Short - Price of Underlying - Max Profit + Commissions Paid	Purchase Price of Underlying + Strike Price of Short Put - (2 x Price of Underlying) - Max Profit + Commissions Paid
Risk	Unlimited	Unlimited
Reward	Limited	Limited

RATIO PUT SPREAD Vs COVERED COMBINATION - Strategy Pros & Cons

	RATIO PUT SPREAD	COVERED COMBINATION
Similar Strategies	Short Straddle (Sell Straddle), Short Strangle (Sell Strangle)	Stock Repair Strategy
Disadvantage	• Unlimited potential risk. • Limited profit.	Combinations can be profitable in sideways or rising markets. Greater combined net credit increases downside protection and potential return.
Advantages	• Directional strategy so that there is either no upside or downside risk. • Able to profit even if trader is neutral on the market. • Higher probability of profit.	Limited Maximum Profit on the upside. Covered Combinations should only be traded on stocks that are bullish.