SHORT GUTS	PROTECTIVE COLLAR
About Strategy	Short Guts Option Strategy  This strategy is implemented by a trader when he is neutral on the movements and bearish on volatility i.e. he expects the stock to be range bound in the near future. This strategy involves sale of 1 ITM Call Option and 1 ITM Put Option. This strategy can be called as Credit Spread since his account is credited at the time of entering in the positions. < 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..

SHORT GUTS Vs PROTECTIVE COLLAR - Details

	SHORT GUTS	PROTECTIVE COLLAR
Market View	Neutral	Neutral
Type (CE/PE)	CE (Call Option) + PE (Put Option)	CE (Call Option) + PE (Put Option)
Number Of Positions	2	2
Strategy Level	Beginners	Beginners
Reward Profile	Limited	Limited
Risk Profile	Unlimited	Limited
Breakeven Point	Upper Breakeven Point = Net Premium Received + Strike Price of Short Call, Lower Breakeven Point = Strike Price of Short Put - Net Premium Received	Purchase Price of Underlying + Net Premium Paid

SHORT GUTS Vs PROTECTIVE COLLAR - When & How to use ?

	SHORT GUTS	PROTECTIVE COLLAR
Market View	Neutral	Neutral
When to use?	This strategy is implemented by a trader when he is neutral on the movements and bearish on volatility i.e. he expects the stock to be range bound 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	Sell 1 ITM Call, Sell 1 ITM Put	• Short 1 Call Option, • Long 1 Put Option
Breakeven Point	Upper Breakeven Point = Net Premium Received + Strike Price of Short Call, Lower Breakeven Point = Strike Price of Short Put - Net Premium Received	Purchase Price of Underlying + Net Premium Paid

SHORT GUTS Vs PROTECTIVE COLLAR - Risk & Reward

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

SHORT GUTS Vs PROTECTIVE COLLAR - Strategy Pros & Cons

	SHORT GUTS	PROTECTIVE COLLAR
Similar Strategies	Short Strangle (Sell Strangle), Short Straddle (Sell Straddle)	Bull Put Spread, Bull Call Spread
Disadvantage	• Unlimited potential loss if the underlying stock continues to move in one direction. • High margin required.	• Potential profit is lower or limited.
Advantages	• Ability to profit even when underlying asset stays stagnant. • You are already paid your full profit the moment the position is put on as this is a credit spread position. • Higher chance of ending in full profit as compared to short strangle or short straddle.	The Risk is limited.