LONG STRADDLE	COVERED PUT
About Strategy	Long Straddle Option Strategy  Straddle is neither bullish nor bearish strategy; it is a market neutral strategy. Here a trader wishes to take advantage of the volatility in the market. This strategy involves buying of one Call option and one Put option of the same strike price, same expiry date and of the same underlying asset. Now a trader is bound to make profits once stock moves in either direc Read more..	Covered Put Option Strategy  This strategy is exactly opposite to Covered Call Strategy. Here the investor is neutral or moderately bearish in nature and wants to take advantage of the price fall in the near future. The trader will short one lot of stock future. Now the trader will short ATM Put Option, the option strike price will be his exit price. If the prices rally above the strike price, the .. Read more..

LONG STRADDLE Vs COVERED PUT - Details

	LONG STRADDLE	COVERED PUT
Market View	Neutral	Bearish
Type (CE/PE)	CE (Call Option) + PE (Put Option)	PE (Put Option) + Underlying
Number Of Positions	2	2
Strategy Level	Beginners	Advance
Reward Profile	Unlimited	Limited
Risk Profile	Limited	Unlimited
Breakeven Point	Lower Breakeven = Strike Price of Put - Net Premium, Upper breakeven = Strike Price of Call + Net Premium	Futures Price + Premium Received

LONG STRADDLE Vs COVERED PUT - When & How to use ?

	LONG STRADDLE	COVERED PUT
Market View	Neutral	Bearish
When to use?	This options strategy is work well when and investor market view is bearish. The strategy minimizes your risk in the event of prime movements going against your expectations.	The Covered Put works well when the market is moderately Bearish.
Action	Buy Call Option, Buy Put Option	Sell Underlying Sell OTM Put Option
Breakeven Point	Lower Breakeven = Strike Price of Put - Net Premium, Upper breakeven = Strike Price of Call + Net Premium	Futures Price + Premium Received

LONG STRADDLE Vs COVERED PUT - Risk & Reward

	LONG STRADDLE	COVERED PUT
Maximum Profit Scenario	Max profit is achieved when at one option is exercised.	The profit happens when the price of the underlying moves above strike price of Short Put.
Maximum Loss Scenario	Maximum Loss = Net Premium Paid	Price of Underlying - Sale Price of Underlying - Premium Received
Risk	Limited	Unlimited
Reward	Unlimited	Limited

LONG STRADDLE Vs COVERED PUT - Strategy Pros & Cons

	LONG STRADDLE	COVERED PUT
Similar Strategies	Bear Put Spread	Bear Put Spread, Bear Call Spread
Disadvantage	• There should be continuous movement of the stock and options price for this strategy to be profitable. • Time decay hurts long option if the strike price, expiration date or underlying stock are badly chosen.	• Limited profit, unlimited risk. • Trader should have enough experience before using this strategy.
Advantages	• Unlimited potential beyond the breakeven point in either direction . • Book your profit from highly volatile stocks without determining the direction. • Limited risk, more profit.	• Investors can book profit when underlying stock price drop, move sideways or rises by a small amount. • Able to generate monthly income. • Able to generate profit from fall in prices or mild increase in the prices.