SHORT STRANGLE	REVERSE IRON BUTTERFLY
About Strategy	Short Strangle Option Strategy  This strategy is similar to Short Straddle; the only difference is of the strike prices at which the positions are built. Short Strangle involves selling of one OTM Call Option and selling of one OTM Put Option, of the same expiry date and same underlying asset. Here the probability of making profits is more as there is a spread between the two strike prices, and if Read more..	Reverse Iron Butterfly Option Strategy Reverse Iron Butterfly as the name suggests is the opposite of Iron Butterfly. In Reverse Iron Butterfly, a trader is bullish on volatility and expects the market to make significant move in the near future in either directions. Here a trader will buy 1 ATM Call Option, sell 1 OTM Call Option, buy 1 ATM Put Option, sell 1 OTM Put Option. This strategy also bags lim .. Read more..

SHORT STRANGLE Vs REVERSE IRON BUTTERFLY - Details

	SHORT STRANGLE	REVERSE IRON BUTTERFLY
Market View	Neutral	Neutral
Type (CE/PE)	CE (Call Option) + PE (Put Option)	CE (Call Option) + PE (Put Option)
Number Of Positions	2	4
Strategy Level	Advance	Advance
Reward Profile	Limited	Limited
Risk Profile	Unlimited	Limited
Breakeven Point	Lower Break-even = Strike Price of Put - Net Premium, Upper Break-even = Strike Price of Call+ Net Premium	Upper Breakeven Point = Strike Price of Long Call + Net Premium Paid, Lower Breakeven Point = Strike Price of Long Put - Net Premium Paid

SHORT STRANGLE Vs REVERSE IRON BUTTERFLY - When & How to use ?

	SHORT STRANGLE	REVERSE IRON BUTTERFLY
Market View	Neutral	Neutral
When to use?	This strategy is perfect in a neutral market scenario when the underlying is expected to be less volatile.	This strategy is used when a trader is bullish on volatility and expects the market to make significant move in the near future in either directions.
Action	Sell OTM Call, Sell OTM Put	Sell 1 OTM Put, Buy 1 ATM Put, Buy 1 ATM Call, Sell 1 OTM Call
Breakeven Point	Lower Break-even = Strike Price of Put - Net Premium, Upper Break-even = Strike Price of Call+ Net Premium	Upper Breakeven Point = Strike Price of Long Call + Net Premium Paid, Lower Breakeven Point = Strike Price of Long Put - Net Premium Paid

SHORT STRANGLE Vs REVERSE IRON BUTTERFLY - Risk & Reward

	SHORT STRANGLE	REVERSE IRON BUTTERFLY
Maximum Profit Scenario	Maximum Profit = Net Premium Received	Strike Price of Short Call (or Long Put) - Strike Price of Long Call (or Short Put) - Net Premium Paid - Commissions Paid
Maximum Loss Scenario	Loss = Price of Underlying - Strike Price of Short Call - Net Premium Received	Net Premium Paid + Commissions Paid
Risk	Unlimited	Limited
Reward	Limited	Limited

SHORT STRANGLE Vs REVERSE IRON BUTTERFLY - Strategy Pros & Cons

	SHORT STRANGLE	REVERSE IRON BUTTERFLY
Similar Strategies	Short Straddle, Long Strangle	Short Put Butterfly, Short Condor
Disadvantage	• Unlimited loss is associated with this strategy, not recommended for beginners. • Limited reward amount.	• Potential loss is higher than gain, complex strategy. • Not suitable for beginners.
Advantages	• Higher chance of profitability due to selling of OTM options. • Advantage from double time decay and a contraction in volatility. • Traders can book profit when underlying asset stays within a tight trading range.	• Able to profit whether stocks move in either direction up or down. • This strategy can be used by option traders who cannot use credit spreads. • Predictable maximum loss and profits, volatile strategy.