COVERED PUT	LONG CALL BUTTERFLY
About Strategy	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..	Long Call Butterfly Option Strategy A trader, who is neutral in nature and believes that there will be very low volatility i.e. expects the market to remain range bound, will implement this strategy. This strategy involves selling of 2 ATM Call Options, buying 1 ITM Call Option & buying 1 OTM Call Option of the same expiry date & same underlying asset. The difference between the strikes sho .. Read more..

COVERED PUT Vs LONG CALL BUTTERFLY - Details

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

COVERED PUT Vs LONG CALL BUTTERFLY - When & How to use ?

	COVERED PUT	LONG CALL BUTTERFLY
Market View	Bearish	Neutral
When to use?	The Covered Put works well when the market is moderately Bearish.	This strategy should be used when you're expecting no volatility in the price of the underlying.
Action	Sell Underlying Sell OTM Put Option	Sell 2 ATM Call, Buy 1 ITM Call, Buy 1 OTM Call
Breakeven Point	Futures Price + Premium Received	Upper Breakeven = Higher Strike Price - Net Premium, Lower Breakeven = Lower Strike Price + Net Premium

COVERED PUT Vs LONG CALL BUTTERFLY - Risk & Reward

	COVERED PUT	LONG CALL BUTTERFLY
Maximum Profit Scenario	The profit happens when the price of the underlying moves above strike price of Short Put.	Adjacent strikes - Net premium debit.
Maximum Loss Scenario	Price of Underlying - Sale Price of Underlying - Premium Received	Net Premium Paid
Risk	Unlimited	Limited
Reward	Limited	Limited

COVERED PUT Vs LONG CALL BUTTERFLY - Strategy Pros & Cons

	COVERED PUT	LONG CALL BUTTERFLY
Similar Strategies	Bear Put Spread, Bear Call Spread	-
Disadvantage	• Limited profit, unlimited risk. • Trader should have enough experience before using this strategy.	• Due to limited lifespan of call options, you can lose the premium paid. • Limited profit which is bound in a narrow range between the two wing strikes.
Advantages	• 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.	• Under this strategy, a trader can book profit even when there is not volatility in the market. • Limited risks to the net premium paid. • This strategy allows you to gain more profits by investing less and limiting your losses to minimum.