COVERED COMBINATION	SHORT PUT LADDER
About Strategy	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..	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..

COVERED COMBINATION Vs SHORT PUT LADDER - Details

	COVERED COMBINATION	SHORT PUT LADDER
Market View	Bullish	Neutral
Type (CE/PE)	CE (Call Option) + PE (Put Option)	PE (Put Option)
Number Of Positions	2	3
Strategy Level	Advance	Advance
Reward Profile	Limited	Unlimited
Risk Profile	Unlimited	Limited
Breakeven Point	(Purchase Price of Underlying + Strike Price of Short Put - Net Premium Received) / 2	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

COVERED COMBINATION Vs SHORT PUT LADDER - When & How to use ?

	COVERED COMBINATION	SHORT PUT LADDER
Market View	Bullish	Neutral
When to use?	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.	This strategy is implemented when a trader is slightly bearish on the market.
Action	Sell 1 OTM Call, Sell 1 OTM Put	Sell ITM Put Option, Buying 1 ATM & 1 OTM Put Option.
Breakeven Point	(Purchase Price of Underlying + Strike Price of Short Put - Net Premium Received) / 2	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

COVERED COMBINATION Vs SHORT PUT LADDER - Risk & Reward

	COVERED COMBINATION	SHORT PUT LADDER
Maximum Profit Scenario	Strike Price of Short Call - Purchase Price of Underlying + Net Premium Received - Commissions Paid	When Price of Underlying < Total Strike Prices of Long Puts - Strike Price of Short Put + Net Premium Received
Maximum Loss Scenario	Purchase Price of Underlying + Strike Price of Short Put - (2 x Price of Underlying) - Max Profit + Commissions Paid	Strike Price of Short Put - Strike Price of Higher Strike Long Put - Net Premium Received + Commissions Paid
Risk	Unlimited	Limited
Reward	Limited	Unlimited

COVERED COMBINATION Vs SHORT PUT LADDER - Strategy Pros & Cons

	COVERED COMBINATION	SHORT PUT LADDER
Similar Strategies	Stock Repair Strategy	Strap, Strip
Disadvantage	Combinations can be profitable in sideways or rising markets. Greater combined net credit increases downside protection and potential return.	• Best to use when you are confident about movement of market. • Small margin required.
Advantages	Limited Maximum Profit on the upside. Covered Combinations should only be traded on stocks that are bullish.	• When there is surge in implied volatility, this strategy can give more profit. • Unlimited downside profit. • Limited risk and unlimited reward strategy.