SHORT PUT	THE COLLAR
About Strategy	Short Put Option Strategy A trader will short put if he is bullish in nature and expects the underlying asset not to fall below a certain level. Risk: Losses will be potentially unlimited if the stock skyrockets above the strike price of put. Read more..	The Collar Option Strategy Collar Strategy is an extension to Covered Call Strategy. A trader, who is bullish in nature but has a very low risk appetite and wants to mitigate his risk will implement the Collar Strategy. Collar involves buying of stock in either Cash/Futures Market, buying an ATM Put Option & selling an OTM Call Option. The expiry dates of the op .. Read more..

SHORT PUT Vs THE COLLAR - Details

	SHORT PUT	THE COLLAR
Market View	Bullish	Bullish
Type (CE/PE)	PE (Put Option)	CE (Call Option) + PE (Put Option) + Underlying
Number Of Positions	1	3
Strategy Level	Beginners	Advance
Reward Profile	Limited	Limited
Risk Profile	Unlimited	Limited
Breakeven Point	Strike Price - Premium	Price of Features - Call Premium + Put Premium

SHORT PUT Vs THE COLLAR - When & How to use ?

	SHORT PUT	THE COLLAR
Market View	Bullish	Bullish
When to use?	This strategy works well when you're Bullish that the price of the underlying will not fall beyond a certain level.	It should be used only in case where trader is certain about the bearish market view.
Action	Sell Put Option	Buy Underlying, Buy 1 ATM Put Option, Sell 1 OTM Call Option
Breakeven Point	Strike Price - Premium	Price of Features - Call Premium + Put Premium

SHORT PUT Vs THE COLLAR - Risk & Reward

	SHORT PUT	THE COLLAR
Maximum Profit Scenario	Premium received in your account when you sell the Put Option.	Strike Price of Short Call - Purchase Price of Underlying + Net Premium Received
Maximum Loss Scenario	Unlimited (When the price of the underlying falls.)	Purchase Price of Underlying - Strike Price of Long Put - Net Premium Received
Risk	Unlimited	Limited
Reward	Limited	Limited

SHORT PUT Vs THE COLLAR - Strategy Pros & Cons

	SHORT PUT	THE COLLAR
Similar Strategies	Bull Put Spread, Short Starddle	Call Spread, Bull Put Spread
Disadvantage	• Unlimited risk. • Huge losses if the price of the underlying stock falls steeply.	• Limited profit. • A trader can book more profit without this strategy if the prices goes high.
Advantages	• Benefit from time decay. • Less capital required than buying the stock outright. • Profit when underlying stock price rise, move sideways or drop by a relatively small account.	• This strategy protects the losses on underlying asset. • Risk gets limited if the price of the stocks goes down. • Trader can get ownership benefits life dividend and voting rights.