RATIO PUT SPREAD	STRAP
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..	Strap Option Strategy  Strap Strategy is similar to Long Straddle, the only difference is the quantity traded. A trader will buy two Call Options and one Put Options. In this strategy, a trader is very bullish on the market and volatility on upside but wants to hedge himself in case the stock doesn’t perform as per his expectations. This strategy will make more profits compared to long straddle sin .. Read more..

RATIO PUT SPREAD Vs STRAP - Details

	RATIO PUT SPREAD	STRAP
Market View	Neutral	Neutral
Type (CE/PE)	PE (Put Option)	CE (Call Option) + PE (Put Option)
Number Of Positions	3	3
Strategy Level	Beginners	Beginners
Reward Profile	Limited	Profit Achieved When Price of Underlying > Strike Price of Calls/Puts + (Net Premium Paid/2) OR Price of Underlying < Strike Price of Calls/Puts - Net Premium Paid
Risk Profile	Unlimited	Max Loss Occurs When Price of Underlying = Strike Price of Calls/Puts
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)	Strike Price of Calls/Puts + (Net Premium Paid/2)

RATIO PUT SPREAD Vs STRAP - When & How to use ?

	RATIO PUT SPREAD	STRAP
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 used when the investor is bullish on the stock and expects volatility in the near future.
Action	Buy 1 ITM Put, Sell 2 OTM Puts	Buy 2 ATM Call Option, Buy 1 ATM 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)	Strike Price of Calls/Puts + (Net Premium Paid/2)

RATIO PUT SPREAD Vs STRAP - Risk & Reward

	RATIO PUT SPREAD	STRAP
Maximum Profit Scenario	Strike Price of Long Put - Strike Price of Short Put + Net Premium Received - Commissions Paid	UNLIMITED
Maximum Loss Scenario	Strike Price of Short - Price of Underlying - Max Profit + Commissions Paid	Net Premium Paid
Risk	Unlimited	Limited
Reward	Limited	Unlimited

RATIO PUT SPREAD Vs STRAP - Strategy Pros & Cons

	RATIO PUT SPREAD	STRAP
Similar Strategies	Short Straddle (Sell Straddle), Short Strangle (Sell Strangle)	Strip, Short Put Ladder, Short Call Ladder
Disadvantage	• Unlimited potential risk. • Limited profit.	• To generate profit, there should be significant change in share price. • Expensive strategy.
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.	• Limited loss. • If share prices are moving then traders can book unlimited profit. • A trader can still book profit if the underlying falls substantially.