LONG PUT	RATIO PUT WRITE
About Strategy	Long Put Option Strategy This strategy is implemented by buying 1 Put Option i.e. a single position, when the person is bearish on the market and expects the market to move downwards in the near future. Risk: The maximum loss will be the premium amount paid.< Read more..	Ratio Put Write Option Strategy  This strategy is implemented by selling (short) the underlying asset in the cash/futures market. Simultaneously, sell ATM Puts double the number of long quantity. This strategy is used by a trader who in 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..

LONG PUT Vs RATIO PUT WRITE - Details

	LONG PUT	RATIO PUT WRITE
Market View	Bearish	Neutral
Type (CE/PE)	PE (Put Option)	PE (Put Option)
Number Of Positions	1	2
Strategy Level	Beginners	Beginners
Reward Profile	Unlimited	Max Profit Achieved When Price of Underlying = Strike Price of Short Puts
Risk Profile	Limited	Loss Occurs When Price of Underlying < Strike Price of Short Put - Net Premium Received OR Price of Underlying > Strike Price of Short Put + Net Premium Received
Breakeven Point	Strike Price of Long Put - Premium Paid	Upper Breakeven Point = Strike Price of Short Puts + Points of Maximum Profit Lower Breakeven Point = Strike Price of Short Puts - Points of Maximum Profit

LONG PUT Vs RATIO PUT WRITE - When & How to use ?

	LONG PUT	RATIO PUT WRITE
Market View	Bearish	Neutral
When to use?	A long put option strategy works well when you're expecting the underlying asset to sharply decline or be volatile in near future.	This strategy is implemented by selling (short) the underlying asset in the cash/futures market. This strategy is used by a trader who in neutral on the market and bearish on the volatility in the near future
Action	Buy Put Option	Sell 2 ATM Puts
Breakeven Point	Strike Price of Long Put - Premium Paid	Upper Breakeven Point = Strike Price of Short Puts + Points of Maximum Profit Lower Breakeven Point = Strike Price of Short Puts - Points of Maximum Profit

LONG PUT Vs RATIO PUT WRITE - Risk & Reward

	LONG PUT	RATIO PUT WRITE
Maximum Profit Scenario	Profit = Strike Price of Long Put - Premium Paid	Net Premium Received - Commissions Paid
Maximum Loss Scenario	Max Loss = Premium Paid + Commissions Paid	Price of Underlying - Sale Price of Underlying - Net Premium Received OR Strike Price of Short Put - Price of Underlying - Net Premium Received + Commissions Paid
Risk	Limited	Unlimited
Reward	Unlimited	Limited

LONG PUT Vs RATIO PUT WRITE - Strategy Pros & Cons

	LONG PUT	RATIO PUT WRITE
Similar Strategies	Protective Call, Short Put	Short Strangle and Short Straddle
Disadvantage	• 100% loss if strike price, expiration dates or underlying stocks are badly chosen. • Time decay.	• Potential loss is higher than gain. • Limited profit.
Advantages	• Limited risk to the premium paid. • Less capital investment and more profit. • Unlimited profit potential with limited risk.