THE COLLAR	PUT BACKSPREAD
About Strategy	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..	Put Backspread Option Strategy If the trader is bearish on market and bullish in volatility, he will implement this strategy. However the trader can be neutral in nature i.e. indifferent if the market moves in either of the direction, this strategy will make profits, but uptrend will give a capped income than downtrend which will give unlimited returns. Read more..

THE COLLAR Vs PUT BACKSPREAD - Details

	THE COLLAR	PUT BACKSPREAD
Market View	Bullish	Bearish
Type (CE/PE)	CE (Call Option) + PE (Put Option) + Underlying	PE (Put Option)
Number Of Positions	3	2
Strategy Level	Advance	Advance
Reward Profile	Limited
Risk Profile	Limited
Breakeven Point	Price of Features - Call Premium + Put Premium

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

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

THE COLLAR Vs PUT BACKSPREAD - Risk & Reward

	THE COLLAR	PUT BACKSPREAD
Maximum Profit Scenario	Strike Price of Short Call - Purchase Price of Underlying + Net Premium Received
Maximum Loss Scenario	Purchase Price of Underlying - Strike Price of Long Put - Net Premium Received
Risk	Limited	Limited
Reward	Limited	Unlimited

THE COLLAR Vs PUT BACKSPREAD - Strategy Pros & Cons

	THE COLLAR	PUT BACKSPREAD
Similar Strategies	Call Spread, Bull Put Spread
Disadvantage	• Limited profit. • A trader can book more profit without this strategy if the prices goes high.
Advantages	• 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.