CALL BACKSPREAD	SHORT CALL 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..	Short Call Butterfly Option Strategy This strategy is opposite of the Long Call Butterfly Strategy, a trader expects the market to remain range bound in Long Call Butterfly, but here he expects the market to move beyond strike boundaries in Short Call Butterfly. If the trader is bullish on the market’s volatility, he will implement this strategy. Here also there should be equal distance between the .. Read more..

CALL BACKSPREAD Vs SHORT CALL BUTTERFLY - Details

	CALL BACKSPREAD	SHORT CALL BUTTERFLY
Market View	Bullish	Neutral
Type (CE/PE)	CE (Call Option)	CE (Call 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	Lower Break-even = Lower Strike Price + Net Premium, Upper Break-even = Higher Strike Price - Net Premium

CALL BACKSPREAD Vs SHORT CALL BUTTERFLY - When & How to use ?

	CALL BACKSPREAD	SHORT CALL 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.	This strategy is meant for special scenarios where you foresee a lot of volatility in the market due to election results, budget, policy change, annual result announcements etc.
Action	Sell 1 ITM Call, BUY 2 OTM Call	Buy 2 ATM Call, Sell 1 ITM Call, Sell 1 OTM Call
Breakeven Point	Lower breakeven = strike price of the short call, Upper breakeven = strike price of long calls + point of maximum loss	Lower Break-even = Lower Strike Price + Net Premium, Upper Break-even = Higher Strike Price - Net Premium

CALL BACKSPREAD Vs SHORT CALL BUTTERFLY - Risk & Reward

	CALL BACKSPREAD	SHORT CALL BUTTERFLY
Maximum Profit Scenario	Unlimited profit potential if the stock goes in upward direction.	The profit is limited to the net premium received.
Maximum Loss Scenario	Strike Price of long call - Strike Price of short call - Net premium received	Higher strike price- Lower Strike Price - Net Premium
Risk	Limited	Limited
Reward	Unlimited	Limited

CALL BACKSPREAD Vs SHORT CALL BUTTERFLY - Strategy Pros & Cons

	CALL BACKSPREAD	SHORT CALL BUTTERFLY
Similar Strategies	-	Long Straddle, Long Call Butterfly
Disadvantage		• Limited rewards, usually offer smaller return. • Profitability depends on the significant movement of stocks and options prices.
Advantages	• Unlimited profit potential.	• Even if the market is highly volatile, the risk exposure remains limited. • Without any extra investment, you can receive your premium. • Able to book profits even when the price movement cannot be predicted.