SHORT STRADDLE	PROTECTIVE PUT
About Strategy	Short Straddle Option strategy This strategy is just the opposite of Long Straddle. A trader should adopt this strategy when he expects less volatility in the near future. Here, a trader will sell one Call Option & one Put Option of the same strike price, same expiry date and of the same underlying asset. If the stock/index hovers around the same levels then both the options will expire worthless an Read more..	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 STRADDLE Vs PROTECTIVE PUT - Details

	SHORT STRADDLE	PROTECTIVE PUT
Market View	Neutral	Bullish
Type (CE/PE)	CE (Call Option) + PE (Put Option)	PE (Put Option)
Number Of Positions	2	1
Strategy Level	Advance	Beginners
Reward Profile	Limited	Unlimited
Risk Profile	Unlimited	Limited
Breakeven Point	Lower Breakeven = Strike Price of Put - Net Premium, Upper breakeven = Strike Price of Call+ Net Premium	Purchase Price of Underlying + Premium Paid

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

	SHORT STRADDLE	PROTECTIVE PUT
Market View	Neutral	Bullish
When to use?	This strategy is work well when an investor expect a flat market in the coming days with very less movement in the prices of underlying asset.	This strategy is adopted when a trader is long on the underlying asset but skeptical of the downside.
Action	Sell Call Option, Sell Put Option	Buy 1 ATM Put
Breakeven Point	Lower Breakeven = Strike Price of Put - Net Premium, Upper breakeven = Strike Price of Call+ Net Premium	Purchase Price of Underlying + Premium Paid

SHORT STRADDLE Vs PROTECTIVE PUT - Risk & Reward

	SHORT STRADDLE	PROTECTIVE PUT
Maximum Profit Scenario	Max Profit = Net Premium Received - Commissions Paid	Price of Underlying - Purchase Price of Underlying - Premium Paid
Maximum Loss Scenario	Maximum Loss = Long Call Strike Price - Short Call Strike Price - Net Premium Received	Premium Paid + Purchase Price of Underlying - Put Strike + Commissions Paid
Risk	Unlimited	Limited
Reward	Limited	Unlimited

SHORT STRADDLE Vs PROTECTIVE PUT - Strategy Pros & Cons

	SHORT STRADDLE	PROTECTIVE PUT
Similar Strategies	Short Strangle	Long Call, Call Backspread
Disadvantage	• Unlimited risk. • If the price of the underlying asset moves in either direction then huge losses can occur.	• 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.
Advantages	• A trader can earn profit even when there is no volatility in the market . • Allows you to benefit from double time decay. • Trader can collect premium from puts and calls option .	• 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.