LONG PUT BUTTERFLY	SHORT CALL
About Strategy	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..	Short Call Option Strategy A trader shorts or writes a Call Option when he feels that underlying stock price is likely to go down. Selling Call Option is a strategy preferred for experienced traders. However this strategy is very risky in nature. If the stock rallies on the upside, your risk becomes potentially unquantifiable and unlimited. If the strategy .. Read more..

LONG PUT BUTTERFLY Vs SHORT CALL - Details

	LONG PUT BUTTERFLY	SHORT CALL
Market View	Neutral	Bearish
Type (CE/PE)	PE (Put Option)	CE (Call Option)
Number Of Positions	4	1
Strategy Level	Advance	Advance
Reward Profile	Limited	Limited
Risk Profile	Limited	Unlimited
Breakeven Point	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	Strike Price of Short Call + Premium Received

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

	LONG PUT BUTTERFLY	SHORT CALL
Market View	Neutral	Bearish
When to use?	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.	It is an aggressive strategy and involves huge risks. It should be used only in case where trader is certain about the bearish market view on the underlying.
Action	Buy 1 OTM Put, Sell 2 ATM Puts, Buy 1 ITM Put	Sell or Write Call Option
Breakeven Point	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	Strike Price of Short Call + Premium Received

LONG PUT BUTTERFLY Vs SHORT CALL - Risk & Reward

	LONG PUT BUTTERFLY	SHORT CALL
Maximum Profit Scenario	Strike Price of Higher Strike Long Put - Strike Price of Short Put - Net Premium Paid - Commissions Paid	Max Profit = Premium Received
Maximum Loss Scenario	When Price of Underlying <= Strike Price of Lower Strike Long Put OR Price of Underlying >= Strike Price of Higher Strike Long Put	Loss Occurs When Price of Underlying > Strike Price of Short Call + Premium Received
Risk	Limited	Unlimited
Reward	Limited	Limited

LONG PUT BUTTERFLY Vs SHORT CALL - Strategy Pros & Cons

	LONG PUT BUTTERFLY	SHORT CALL
Similar Strategies	Iron Condors, Iron Butterfly	Covered Put, Covered Calls
Disadvantage	• Risk is higher than reward. • When the underlying price is in between the two breakeven points, time decay hurts the position.	• Unlimited risk to the upside underlying stocks. • Potential loss more than the premium collected.
Advantages	• Limited maximum loss. • Unlimited profit potential, risk only limited to loss of premium. • Benefits from low volatility.	• With the help of this strategy, traders can book profit from falling prices in the underlying asset. • Less investment, more profit. • Traders can book profit when underlying stock price fall, move sideways or rise by a small amount.