IRON BUTTERFLY	STRAP
About Strategy	Iron Butterfly Option Strategy  This strategy is implemented when a trader is bearish on the volatility of market and neutral on the market movements. A trader will buy 1 OTM Put Option, sell 1 ATM Put Option, sell 1 ATM Call Option, buy 1 OTM Call Option. Due to offsetting of long and short positions, this strategy bags limited profit with limited risk. Read more..	Strap Option Strategy  Strap Strategy is similar to Long Straddle, the only difference is the quantity traded. A trader will buy two Call Options and one Put Options. In this strategy, a trader is very bullish on the market and volatility on upside but wants to hedge himself in case the stock doesn’t perform as per his expectations. This strategy will make more profits compared to long straddle sin .. Read more..

IRON BUTTERFLY Vs STRAP - Details

	IRON BUTTERFLY	STRAP
Market View	Neutral	Neutral
Type (CE/PE)	CE (Call Option) + PE (Put Option)	CE (Call Option) + PE (Put Option)
Number Of Positions	4	3
Strategy Level	Advance	Beginners
Reward Profile	Limited	Profit Achieved When Price of Underlying > Strike Price of Calls/Puts + (Net Premium Paid/2) OR Price of Underlying < Strike Price of Calls/Puts - Net Premium Paid
Risk Profile	Limited	Max Loss Occurs When Price of Underlying = Strike Price of Calls/Puts
Breakeven Point	Upper Breakeven Point = Strike Price of Short Call + Net Premium Received, Lower Breakeven Point = Strike Price of Short Put - Net Premium Received	Strike Price of Calls/Puts + (Net Premium Paid/2)

IRON BUTTERFLY Vs STRAP - When & How to use ?

	IRON BUTTERFLY	STRAP
Market View	Neutral	Neutral
When to use?	This strategy is implemented when a trader is bearish on the volatility of market and neutral on the market movements.	This strategy is used when the investor is bullish on the stock and expects volatility in the near future.
Action	Buy 1 OTM Put, Sell 1 ATM Put, Sell 1 ATM Call, Buy 1 OTM Call	Buy 2 ATM Call Option, Buy 1 ATM Put Option
Breakeven Point	Upper Breakeven Point = Strike Price of Short Call + Net Premium Received, Lower Breakeven Point = Strike Price of Short Put - Net Premium Received	Strike Price of Calls/Puts + (Net Premium Paid/2)

IRON BUTTERFLY Vs STRAP - Risk & Reward

	IRON BUTTERFLY	STRAP
Maximum Profit Scenario	Net Premium Received - Commissions Paid	UNLIMITED
Maximum Loss Scenario	Strike Price of Long Call - Strike Price of Short Call - Net Premium Received + Commissions Paid	Net Premium Paid
Risk	Limited	Limited
Reward	Limited	Unlimited

IRON BUTTERFLY Vs STRAP - Strategy Pros & Cons

	IRON BUTTERFLY	STRAP
Similar Strategies	Long Put Butterfly, Neutral Calendar Spread	Strip, Short Put Ladder, Short Call Ladder
Disadvantage	• Large commissions involved. • Probability of losses are higher.	• To generate profit, there should be significant change in share price. • Expensive strategy.
Advantages	• Less amount of capital investment, steady income with low risk. • Traders can predict maximum loss and profit. • Versatile strategy, investors can transform position into bear call spread or bull put spread easily.	• Limited loss. • If share prices are moving then traders can book unlimited profit. • A trader can still book profit if the underlying falls substantially.