RATIO PUT SPREAD	RISK REVERSAL
About Strategy	Ratio Put Spread Option Strategy  This strategy involves buying ITM Puts and simultaneously selling OTM Puts, double the number of ITM Puts. This strategy is used by a trader who is 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..	Risk Reversal Option Strategy This strategy protects an investor from unfavourable price movements in the position but limits the profits can be made on that position. A risk reversal is a hedging strategy that protects a long or short position by using put and call options. In this one option is buying and other is written. In this strategy the trader has to pay a premium, while the written option prod .. Read more..

RATIO PUT SPREAD Vs RISK REVERSAL - Details

	RATIO PUT SPREAD	RISK REVERSAL
Market View	Neutral	Bullish
Type (CE/PE)	PE (Put Option)	CE (Call Option) + PE (Put Option)
Number Of Positions	3	2
Strategy Level	Beginners	Advance
Reward Profile	Limited	Unlimited
Risk Profile	Unlimited	Unlimited
Breakeven Point	Upper Breakeven Point = Strike Price of Long Put +/- Net Premium Received or Paid, Lower Breakeven Point = Strike Price of Short Puts - (Points of Maximum Profit / Number of Uncovered Puts)	Premium received - Put Strike Price

RATIO PUT SPREAD Vs RISK REVERSAL - When & How to use ?

	RATIO PUT SPREAD	RISK REVERSAL
Market View	Neutral	Bullish
When to use?	This strategy is used by a trader who is neutral on the market and bearish on the volatility in the near future.	This strategy can be used for hedging. When an investor want to protect long or short position by using a call and put option.
Action	Buy 1 ITM Put, Sell 2 OTM Puts	This strategy work when an investor want to hedge their position by buying a put option and selling a call option.
Breakeven Point	Upper Breakeven Point = Strike Price of Long Put +/- Net Premium Received or Paid, Lower Breakeven Point = Strike Price of Short Puts - (Points of Maximum Profit / Number of Uncovered Puts)	Premium received - Put Strike Price

RATIO PUT SPREAD Vs RISK REVERSAL - Risk & Reward

	RATIO PUT SPREAD	RISK REVERSAL
Maximum Profit Scenario	Strike Price of Long Put - Strike Price of Short Put + Net Premium Received - Commissions Paid	You have unlimited profit potential to the upside.
Maximum Loss Scenario	Strike Price of Short - Price of Underlying - Max Profit + Commissions Paid	You have nearly unlimited downside risk as well because you are short the put
Risk	Unlimited	Unlimited
Reward	Limited	Unlimited

RATIO PUT SPREAD Vs RISK REVERSAL - Strategy Pros & Cons

	RATIO PUT SPREAD	RISK REVERSAL
Similar Strategies	Short Straddle (Sell Straddle), Short Strangle (Sell Strangle)	-
Disadvantage	• Unlimited potential risk. • Limited profit.	Unlimited Risk.
Advantages	• Directional strategy so that there is either no upside or downside risk. • Able to profit even if trader is neutral on the market. • Higher probability of profit.	Unlimited profit.