IRON BUTTERFLY	LONG STRANGLE
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..	Long Strangle Option Strategy A Strangle is similar to Straddle. In Strangle, a trader will purchase one OTM Call Option and one OTM Put Option, of the same expiry date and the same underlying asset. This strategy will reduce the entry cost for trader and it is also cheaper than straddle. A trader will make profits, if the market moves sharply in either direction and gives extra-ordinary returns in the .. Read more..

IRON BUTTERFLY Vs LONG STRANGLE - Details

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

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

	IRON BUTTERFLY	LONG STRANGLE
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 in special scenarios where you foresee a lot of volatility in the market due to election results, budget, policy change, annual result announcements etc.
Action	Buy 1 OTM Put, Sell 1 ATM Put, Sell 1 ATM Call, Buy 1 OTM Call	Buy OTM Call Option, Buy OTM 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	Lower Breakeven Point = Strike Price of Put - Net Premium, Upper Breakeven Point = Strike Price of Call + Net Premium

IRON BUTTERFLY Vs LONG STRANGLE - Risk & Reward

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

IRON BUTTERFLY Vs LONG STRANGLE - Strategy Pros & Cons

	IRON BUTTERFLY	LONG STRANGLE
Similar Strategies	Long Put Butterfly, Neutral Calendar Spread	Long Straddle, Short Strangle
Disadvantage	• Large commissions involved. • Probability of losses are higher.	• Require significant price movement to book profit. • Traders can lose more money if the underlying asset stayed stagnant.
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.	• Able to book profit, no matter if the underlying asset goes in either direction. • Limited loss to the debit paid. • If the underlying asset continues to move in one direction then you can book Unlimited profit .