SHORT PUT BUTTERFLY	SHORT STRANGLE
About Strategy	Short Put Butterfly Option Strategy  In Short Put Butterfly strategy, a trader is neutral in nature and expects the market to remain range bound in the near future. A trader will buy 2 ATM Put Options; sell 1 ITM & 1 OTM Put Options. Here risk and returns both are limited. Risk:< Read more..	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..

SHORT PUT BUTTERFLY Vs SHORT STRANGLE - Details

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

SHORT PUT BUTTERFLY Vs SHORT STRANGLE - When & How to use ?

	SHORT PUT BUTTERFLY	SHORT STRANGLE
Market View	Neutral	Neutral
When to use?	In Short Put Butterfly strategy, a trader is neutral in nature and expects the market to remain range bound in the near future.	This strategy is perfect in a neutral market scenario when the underlying is expected to be less volatile.
Action	Sell 1 ITM Put, Buy 2 ATM Put, Sell 1 OTM Put	Sell OTM Call, Sell OTM Put
Breakeven Point	Upper Breakeven Point = Strike Price of Highest Strike Short Put - Net Premium Received, Lower Breakeven Point = Strike Price of Lowest Strike Short Put + Net Premium Received	Lower Break-even = Strike Price of Put - Net Premium, Upper Break-even = Strike Price of Call+ Net Premium

SHORT PUT BUTTERFLY Vs SHORT STRANGLE - Risk & Reward

	SHORT PUT BUTTERFLY	SHORT STRANGLE
Maximum Profit Scenario	Net Premium Received - Commissions Paid	Maximum Profit = Net Premium Received
Maximum Loss Scenario	Strike Price of Higher Strike Short Put - Strike Price of Long Put - Net Premium Received + Commissions Paid	Loss = Price of Underlying - Strike Price of Short Call - Net Premium Received
Risk	Limited	Unlimited
Reward	Limited	Limited

SHORT PUT BUTTERFLY Vs SHORT STRANGLE - Strategy Pros & Cons

	SHORT PUT BUTTERFLY	SHORT STRANGLE
Similar Strategies	Short Condor, Reverse Iron Condor	Short Straddle, Long Strangle
Disadvantage	• High risk strategy and may cause huge losses if the price of the underlying stocks falls steeply. • Higher profit is only possible when shares get close to expiration.	• Unlimited loss is associated with this strategy, not recommended for beginners. • Limited reward amount.
Advantages	• Benefits from time decay. • Traders can earn more in a rising or range bound scenario. • Benefits from a surge in volatility.	• 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.