PROTECTIVE PUT	SHORT PUT LADDER
About Strategy	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..	Short Put Ladder Option Strategy  This strategy is implemented when a trader is slightly bearish on the market. A trader is required to be bullish over the volatility in the market. It involves sale of an ITM Put Option and buying of 1 ATM & 1 OTM Put Options. However, the risk associated with this strategy is limited. Read more..

PROTECTIVE PUT Vs SHORT PUT LADDER - Details

	PROTECTIVE PUT	SHORT PUT LADDER
Market View	Bullish	Neutral
Type (CE/PE)	PE (Put Option)	PE (Put Option)
Number Of Positions	1	3
Strategy Level	Beginners	Advance
Reward Profile	Unlimited	Unlimited
Risk Profile	Limited	Limited
Breakeven Point	Purchase Price of Underlying + Premium Paid	Upper Breakeven Point = Strike Price of Short Put - Net Premium Received Lower Breakeven Point = Total Strike Prices of Long Puts - Strike Price of Short Put + Net Premium Received

PROTECTIVE PUT Vs SHORT PUT LADDER - When & How to use ?

	PROTECTIVE PUT	SHORT PUT LADDER
Market View	Bullish	Neutral
When to use?	This strategy is adopted when a trader is long on the underlying asset but skeptical of the downside.	This strategy is implemented when a trader is slightly bearish on the market.
Action	Buy 1 ATM Put	Sell ITM Put Option, Buying 1 ATM & 1 OTM Put Option.
Breakeven Point	Purchase Price of Underlying + Premium Paid	Upper Breakeven Point = Strike Price of Short Put - Net Premium Received Lower Breakeven Point = Total Strike Prices of Long Puts - Strike Price of Short Put + Net Premium Received

PROTECTIVE PUT Vs SHORT PUT LADDER - Risk & Reward

	PROTECTIVE PUT	SHORT PUT LADDER
Maximum Profit Scenario	Price of Underlying - Purchase Price of Underlying - Premium Paid	When Price of Underlying < Total Strike Prices of Long Puts - Strike Price of Short Put + Net Premium Received
Maximum Loss Scenario	Premium Paid + Purchase Price of Underlying - Put Strike + Commissions Paid	Strike Price of Short Put - Strike Price of Higher Strike Long Put - Net Premium Received + Commissions Paid
Risk	Limited	Limited
Reward	Unlimited	Unlimited

PROTECTIVE PUT Vs SHORT PUT LADDER - Strategy Pros & Cons

	PROTECTIVE PUT	SHORT PUT LADDER
Similar Strategies	Long Call, Call Backspread	Strap, Strip
Disadvantage	• 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.	• Best to use when you are confident about movement of market. • Small margin required.
Advantages	• 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.	• When there is surge in implied volatility, this strategy can give more profit. • Unlimited downside profit. • Limited risk and unlimited reward strategy.