RATIO PUT SPREAD	PROTECTIVE COLLAR
About Strategy	Ratio Put Spread Option Strategy  This strategy involves buying ITM Puts and simultaneously selling OTM Puts, double the number of ITM Puts. This strategy is used by a trader who is neutral on the market and bearish on the volatility in the near future. Here profits will be capped up to the premium amount and risk will be potentially unlimited. Read more..	Protective Collar Strategy This Strategy is implemented when the investor requires downside protection for the short - to medium term but at lower cost. Buying protective puts can be an expensive proposition and writing OTM calls can defray the cost of the puts quite substantially. Protective Collar is considered as bearish to neutral strategy. In this strategy risk and reward is both are limited. This .. Read more..

RATIO PUT SPREAD Vs PROTECTIVE COLLAR - Details

	RATIO PUT SPREAD	PROTECTIVE COLLAR
Market View	Neutral	Neutral
Type (CE/PE)	PE (Put Option)	CE (Call Option) + PE (Put Option)
Number Of Positions	3	2
Strategy Level	Beginners	Beginners
Reward Profile	Limited	Limited
Risk Profile	Unlimited	Limited
Breakeven Point	Upper Breakeven Point = Strike Price of Long Put +/- Net Premium Received or Paid, Lower Breakeven Point = Strike Price of Short Puts - (Points of Maximum Profit / Number of Uncovered Puts)	Purchase Price of Underlying + Net Premium Paid

RATIO PUT SPREAD Vs PROTECTIVE COLLAR - When & How to use ?

	RATIO PUT SPREAD	PROTECTIVE COLLAR
Market View	Neutral	Neutral
When to use?	This strategy is used by a trader who is neutral on the market and bearish on the volatility in the near future.	This Strategy is implemented when the investor requires downside protection for the short - to medium term but at lower cost.
Action	Buy 1 ITM Put, Sell 2 OTM Puts	• Short 1 Call Option, • Long 1 Put Option
Breakeven Point	Upper Breakeven Point = Strike Price of Long Put +/- Net Premium Received or Paid, Lower Breakeven Point = Strike Price of Short Puts - (Points of Maximum Profit / Number of Uncovered Puts)	Purchase Price of Underlying + Net Premium Paid

RATIO PUT SPREAD Vs PROTECTIVE COLLAR - Risk & Reward

	RATIO PUT SPREAD	PROTECTIVE COLLAR
Maximum Profit Scenario	Strike Price of Long Put - Strike Price of Short Put + Net Premium Received - Commissions Paid	• Call strike - stock purchase price - net premium paid + net credit received
Maximum Loss Scenario	Strike Price of Short - Price of Underlying - Max Profit + Commissions Paid	• Stock purchase price - put strike - net premium paid - put strike + net credit received
Risk	Unlimited	Limited
Reward	Limited	Limited

RATIO PUT SPREAD Vs PROTECTIVE COLLAR - Strategy Pros & Cons

	RATIO PUT SPREAD	PROTECTIVE COLLAR
Similar Strategies	Short Straddle (Sell Straddle), Short Strangle (Sell Strangle)	Bull Put Spread, Bull Call Spread
Disadvantage	• Unlimited potential risk. • Limited profit.	• Potential profit is lower or limited.
Advantages	• Directional strategy so that there is either no upside or downside risk. • Able to profit even if trader is neutral on the market. • Higher probability of profit.	The Risk is limited.