SHORT PUT BUTTERFLY	COVERED PUT
About Strategy	Short Put Butterfly Option Strategy  In Short Put Butterfly strategy, a trader is neutral in nature and expects the market to remain range bound in the near future. A trader will buy 2 ATM Put Options; sell 1 ITM & 1 OTM Put Options. Here risk and returns both are limited. Risk:< Read more..	Covered Put Option Strategy  This strategy is exactly opposite to Covered Call Strategy. Here the investor is neutral or moderately bearish in nature and wants to take advantage of the price fall in the near future. The trader will short one lot of stock future. Now the trader will short ATM Put Option, the option strike price will be his exit price. If the prices rally above the strike price, the .. Read more..

SHORT PUT BUTTERFLY Vs COVERED PUT - Details

	SHORT PUT BUTTERFLY	COVERED PUT
Market View	Neutral	Bearish
Type (CE/PE)	PE (Put Option)	PE (Put Option) + Underlying
Number Of Positions	4	2
Strategy Level	Advance	Advance
Reward Profile	Limited	Limited
Risk Profile	Limited	Unlimited
Breakeven Point	Upper Breakeven Point = Strike Price of Highest Strike Short Put - Net Premium Received, Lower Breakeven Point = Strike Price of Lowest Strike Short Put + Net Premium Received	Futures Price + Premium Received

SHORT PUT BUTTERFLY Vs COVERED PUT - When & How to use ?

	SHORT PUT BUTTERFLY	COVERED PUT
Market View	Neutral	Bearish
When to use?	In Short Put Butterfly strategy, a trader is neutral in nature and expects the market to remain range bound in the near future.	The Covered Put works well when the market is moderately Bearish.
Action	Sell 1 ITM Put, Buy 2 ATM Put, Sell 1 OTM Put	Sell Underlying Sell OTM Put Option
Breakeven Point	Upper Breakeven Point = Strike Price of Highest Strike Short Put - Net Premium Received, Lower Breakeven Point = Strike Price of Lowest Strike Short Put + Net Premium Received	Futures Price + Premium Received

SHORT PUT BUTTERFLY Vs COVERED PUT - Risk & Reward

	SHORT PUT BUTTERFLY	COVERED PUT
Maximum Profit Scenario	Net Premium Received - Commissions Paid	The profit happens when the price of the underlying moves above strike price of Short Put.
Maximum Loss Scenario	Strike Price of Higher Strike Short Put - Strike Price of Long Put - Net Premium Received + Commissions Paid	Price of Underlying - Sale Price of Underlying - Premium Received
Risk	Limited	Unlimited
Reward	Limited	Limited

SHORT PUT BUTTERFLY Vs COVERED PUT - Strategy Pros & Cons

	SHORT PUT BUTTERFLY	COVERED PUT
Similar Strategies	Short Condor, Reverse Iron Condor	Bear Put Spread, Bear Call Spread
Disadvantage	• High risk strategy and may cause huge losses if the price of the underlying stocks falls steeply. • Higher profit is only possible when shares get close to expiration.	• Limited profit, unlimited risk. • Trader should have enough experience before using this strategy.
Advantages	• Benefits from time decay. • Traders can earn more in a rising or range bound scenario. • Benefits from a surge in volatility.	• Investors can book profit when underlying stock price drop, move sideways or rises by a small amount. • Able to generate monthly income. • Able to generate profit from fall in prices or mild increase in the prices.