LONG PUT BUTTERFLY	THE COLLAR
About Strategy	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..	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..

LONG PUT BUTTERFLY Vs THE COLLAR - Details

	LONG PUT BUTTERFLY	THE COLLAR
Market View	Neutral	Bullish
Type (CE/PE)	PE (Put Option)	CE (Call Option) + PE (Put Option) + Underlying
Number Of Positions	4	3
Strategy Level	Advance	Advance
Reward Profile	Limited	Limited
Risk Profile	Limited	Limited
Breakeven Point	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	Price of Features - Call Premium + Put Premium

LONG PUT BUTTERFLY Vs THE COLLAR - When & How to use ?

	LONG PUT BUTTERFLY	THE COLLAR
Market View	Neutral	Bullish
When to use?	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.	It should be used only in case where trader is certain about the bearish market view.
Action	Buy 1 OTM Put, Sell 2 ATM Puts, Buy 1 ITM Put	Buy Underlying, Buy 1 ATM Put Option, Sell 1 OTM Call Option
Breakeven Point	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	Price of Features - Call Premium + Put Premium

LONG PUT BUTTERFLY Vs THE COLLAR - Risk & Reward

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

LONG PUT BUTTERFLY Vs THE COLLAR - Strategy Pros & Cons

	LONG PUT BUTTERFLY	THE COLLAR
Similar Strategies	Iron Condors, Iron Butterfly	Call Spread, Bull Put Spread
Disadvantage	• Risk is higher than reward. • When the underlying price is in between the two breakeven points, time decay hurts the position.	• Limited profit. • A trader can book more profit without this strategy if the prices goes high.
Advantages	• Limited maximum loss. • Unlimited profit potential, risk only limited to loss of premium. • Benefits from low volatility.	• 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.