SHORT CALL	LONG PUT BUTTERFLY
About Strategy	Short Call Option Strategy A trader shorts or writes a Call Option when he feels that underlying stock price is likely to go down. Selling Call Option is a strategy preferred for experienced traders. However this strategy is very risky in nature. If the stock rallies on the upside, your risk becomes potentially unquantifiable and unlimited. If the strategy Read more..	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..

SHORT CALL Vs LONG PUT BUTTERFLY - Details

	SHORT CALL	LONG PUT BUTTERFLY
Market View	Bearish	Neutral
Type (CE/PE)	CE (Call Option)	PE (Put Option)
Number Of Positions	1	4
Strategy Level	Advance	Advance
Reward Profile	Limited	Limited
Risk Profile	Unlimited	Limited
Breakeven Point	Strike Price of Short Call + Premium Received	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

SHORT CALL Vs LONG PUT BUTTERFLY - When & How to use ?

	SHORT CALL	LONG PUT BUTTERFLY
Market View	Bearish	Neutral
When to use?	It is an aggressive strategy and involves huge risks. It should be used only in case where trader is certain about the bearish market view on the underlying.	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.
Action	Sell or Write Call Option	Buy 1 OTM Put, Sell 2 ATM Puts, Buy 1 ITM Put
Breakeven Point	Strike Price of Short Call + Premium Received	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

SHORT CALL Vs LONG PUT BUTTERFLY - Risk & Reward

	SHORT CALL	LONG PUT BUTTERFLY
Maximum Profit Scenario	Max Profit = Premium Received	Strike Price of Higher Strike Long Put - Strike Price of Short Put - Net Premium Paid - Commissions Paid
Maximum Loss Scenario	Loss Occurs When Price of Underlying > Strike Price of Short Call + Premium Received	When Price of Underlying <= Strike Price of Lower Strike Long Put OR Price of Underlying >= Strike Price of Higher Strike Long Put
Risk	Unlimited	Limited
Reward	Limited	Limited

SHORT CALL Vs LONG PUT BUTTERFLY - Strategy Pros & Cons

	SHORT CALL	LONG PUT BUTTERFLY
Similar Strategies	Covered Put, Covered Calls	Iron Condors, Iron Butterfly
Disadvantage	• Unlimited risk to the upside underlying stocks. • Potential loss more than the premium collected.	• Risk is higher than reward. • When the underlying price is in between the two breakeven points, time decay hurts the position.
Advantages	• With the help of this strategy, traders can book profit from falling prices in the underlying asset. • Less investment, more profit. • Traders can book profit when underlying stock price fall, move sideways or rise by a small amount.	• Limited maximum loss. • Unlimited profit potential, risk only limited to loss of premium. • Benefits from low volatility.