CALL BACKSPREAD	LONG PUT BUTTERFLY
About Strategy	Call Backspread Option Trading  This strategy is adopted by traders who are bullish in nature. He expects market and volatility to rise in the near future. A trader need not be direction specific here (i.e. an upward or downward trend, but a small bias towards an uptrend should always be present, as the gains will be much higher once the market moves up r Read more..	Long Put Butterfly Option Strategy  The Long Put Butterfly is a neutral strategy where a trader will be bearish on the volatility i.e. he thinks the market will have sideways kind of movement and will not rally sharply in either direction in the near future. This strategy involves sale of 2 ATM Put Options, buy 1 ITM and 1 OTM Put Option. The risk and reward are limited. Read more..

CALL BACKSPREAD Vs LONG PUT BUTTERFLY - Details

	CALL BACKSPREAD	LONG PUT BUTTERFLY
Market View	Bullish	Neutral
Type (CE/PE)	CE (Call Option)	PE (Put Option)
Number Of Positions	3	4
Strategy Level	Advance	Advance
Reward Profile	Unlimited	Limited
Risk Profile	Limited	Limited
Breakeven Point	Lower breakeven = strike price of the short call, Upper breakeven = strike price of long calls + point of maximum loss	Upper Breakeven Point = Strike Price of Highest Strike Long Put - Net Premium Paid, Lower Breakeven Point = Strike Price of Lowest Strike Long Put + Net Premium Paid

CALL BACKSPREAD Vs LONG PUT BUTTERFLY - When & How to use ?

	CALL BACKSPREAD	LONG PUT BUTTERFLY
Market View	Bullish	Neutral
When to use?	This strategy is used when the investor expects the price of the stock to rise in the future.	The Long Put Butterfly is a neutral strategy where a trader will be bearish on the volatility i.e. he thinks the market will have sideways kind of movement and will not rally sharply in either direction in the near future.
Action	Sell 1 ITM Call, BUY 2 OTM Call	Buy 1 OTM Put, Sell 2 ATM Puts, Buy 1 ITM Put
Breakeven Point	Lower breakeven = strike price of the short call, Upper breakeven = strike price of long calls + point of maximum loss	Upper Breakeven Point = Strike Price of Highest Strike Long Put - Net Premium Paid, Lower Breakeven Point = Strike Price of Lowest Strike Long Put + Net Premium Paid

CALL BACKSPREAD Vs LONG PUT BUTTERFLY - Risk & Reward

	CALL BACKSPREAD	LONG PUT BUTTERFLY
Maximum Profit Scenario	Unlimited profit potential if the stock goes in upward direction.	Strike Price of Higher Strike Long Put - Strike Price of Short Put - Net Premium Paid - Commissions Paid
Maximum Loss Scenario	Strike Price of long call - Strike Price of short call - Net premium received	When Price of Underlying <= Strike Price of Lower Strike Long Put OR Price of Underlying >= Strike Price of Higher Strike Long Put
Risk	Limited	Limited
Reward	Unlimited	Limited

CALL BACKSPREAD Vs LONG PUT BUTTERFLY - Strategy Pros & Cons

	CALL BACKSPREAD	LONG PUT BUTTERFLY
Similar Strategies	-	Iron Condors, Iron Butterfly
Disadvantage		• Risk is higher than reward. • When the underlying price is in between the two breakeven points, time decay hurts the position.
Advantages	• Unlimited profit potential.	• Limited maximum loss. • Unlimited profit potential, risk only limited to loss of premium. • Benefits from low volatility.