CALL BACKSPREAD	SHORT GUTS
About Strategy	Call Backspread Option Trading  This strategy is adopted by traders who are bullish in nature. He expects market and volatility to rise in the near future. A trader need not be direction specific here (i.e. an upward or downward trend, but a small bias towards an uptrend should always be present, as the gains will be much higher once the market moves up r Read more..	Short Guts Option Strategy  This strategy is implemented by a trader when he is neutral on the movements and bearish on volatility i.e. he expects the stock to be range bound in the near future. This strategy involves sale of 1 ITM Call Option and 1 ITM Put Option. This strategy can be called as Credit Spread since his account is credited at the time of entering in the positions. < .. Read more..

CALL BACKSPREAD Vs SHORT GUTS - Details

	CALL BACKSPREAD	SHORT GUTS
Market View	Bullish	Neutral
Type (CE/PE)	CE (Call Option)	CE (Call Option) + PE (Put Option)
Number Of Positions	3	2
Strategy Level	Advance	Beginners
Reward Profile	Unlimited	Limited
Risk Profile	Limited	Unlimited
Breakeven Point	Lower breakeven = strike price of the short call, Upper breakeven = strike price of long calls + point of maximum loss	Upper Breakeven Point = Net Premium Received + Strike Price of Short Call, Lower Breakeven Point = Strike Price of Short Put - Net Premium Received

CALL BACKSPREAD Vs SHORT GUTS - When & How to use ?

	CALL BACKSPREAD	SHORT GUTS
Market View	Bullish	Neutral
When to use?	This strategy is used when the investor expects the price of the stock to rise in the future.	This strategy is implemented by a trader when he is neutral on the movements and bearish on volatility i.e. he expects the stock to be range bound in the near future.
Action	Sell 1 ITM Call, BUY 2 OTM Call	Sell 1 ITM Call, Sell 1 ITM Put
Breakeven Point	Lower breakeven = strike price of the short call, Upper breakeven = strike price of long calls + point of maximum loss	Upper Breakeven Point = Net Premium Received + Strike Price of Short Call, Lower Breakeven Point = Strike Price of Short Put - Net Premium Received

CALL BACKSPREAD Vs SHORT GUTS - Risk & Reward

	CALL BACKSPREAD	SHORT GUTS
Maximum Profit Scenario	Unlimited profit potential if the stock goes in upward direction.	Net Premium Received + Strike Price of Short Put - Strike Price of Short Call - Commissions Paid
Maximum Loss Scenario	Strike Price of long call - Strike Price of short call - Net premium received	Price of Underlying - Strike Price of Short Call - Net Premium Received OR Strike Price of Short Put - Price of Underlying - Net Premium Received + Commissions Paid
Risk	Limited	Unlimited
Reward	Unlimited	Limited

CALL BACKSPREAD Vs SHORT GUTS - Strategy Pros & Cons

	CALL BACKSPREAD	SHORT GUTS
Similar Strategies	-	Short Strangle (Sell Strangle), Short Straddle (Sell Straddle)
Disadvantage		• Unlimited potential loss if the underlying stock continues to move in one direction. • High margin required.
Advantages	• Unlimited profit potential.	• Ability to profit even when underlying asset stays stagnant. • You are already paid your full profit the moment the position is put on as this is a credit spread position. • Higher chance of ending in full profit as compared to short strangle or short straddle.