LONG PUT	IRON BUTTERFLY
About Strategy	Long Put Option Strategy This strategy is implemented by buying 1 Put Option i.e. a single position, when the person is bearish on the market and expects the market to move downwards in the near future. Risk: The maximum loss will be the premium amount paid.< Read more..	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..

LONG PUT Vs IRON BUTTERFLY - Details

	LONG PUT	IRON BUTTERFLY
Market View	Bearish	Neutral
Type (CE/PE)	PE (Put Option)	CE (Call Option) + PE (Put Option)
Number Of Positions	1	4
Strategy Level	Beginners	Advance
Reward Profile	Unlimited	Limited
Risk Profile	Limited	Limited
Breakeven Point	Strike Price of Long Put - Premium Paid	Upper Breakeven Point = Strike Price of Short Call + Net Premium Received, Lower Breakeven Point = Strike Price of Short Put - Net Premium Received

LONG PUT Vs IRON BUTTERFLY - When & How to use ?

	LONG PUT	IRON BUTTERFLY
Market View	Bearish	Neutral
When to use?	A long put option strategy works well when you're expecting the underlying asset to sharply decline or be volatile in near future.	This strategy is implemented when a trader is bearish on the volatility of market and neutral on the market movements.
Action	Buy Put Option	Buy 1 OTM Put, Sell 1 ATM Put, Sell 1 ATM Call, Buy 1 OTM Call
Breakeven Point	Strike Price of Long Put - Premium Paid	Upper Breakeven Point = Strike Price of Short Call + Net Premium Received, Lower Breakeven Point = Strike Price of Short Put - Net Premium Received

LONG PUT Vs IRON BUTTERFLY - Risk & Reward

	LONG PUT	IRON BUTTERFLY
Maximum Profit Scenario	Profit = Strike Price of Long Put - Premium Paid	Net Premium Received - Commissions Paid
Maximum Loss Scenario	Max Loss = Premium Paid + Commissions Paid	Strike Price of Long Call - Strike Price of Short Call - Net Premium Received + Commissions Paid
Risk	Limited	Limited
Reward	Unlimited	Limited

LONG PUT Vs IRON BUTTERFLY - Strategy Pros & Cons

	LONG PUT	IRON BUTTERFLY
Similar Strategies	Protective Call, Short Put	Long Put Butterfly, Neutral Calendar Spread
Disadvantage	• 100% loss if strike price, expiration dates or underlying stocks are badly chosen. • Time decay.	• Large commissions involved. • Probability of losses are higher.
Advantages	• Limited risk to the premium paid. • Less capital investment and more profit. • Unlimited profit potential with limited risk.	• 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.