IRON CONDORS	COVERED COMBINATION
About Strategy	Iron Condors Option Strategy Iron Condor is a neutral trading strategy. A trader tries to make profit from low volatility in the price of the underlying asset. This strategy will be better understood if you recall ‘Bull Put Spread’ & ‘Bear Call Spread’. A trader will buy one Deep OTM Put Option and sell one OTM Put Option,. He will also sell one OTM Call Option and buy one Deep OTM Call Option. Read more..	Covered Combination Option Strategy This strategy involves selling OTM Call & Put Options and buying the underlying asset in either cash or futures market. It is also known as Covered Strangle as the profits are capped and risk is potentially unlimited. Risk: Un .. Read more..

IRON CONDORS Vs COVERED COMBINATION - Details

	IRON CONDORS	COVERED COMBINATION
Market View	Neutral	Bullish
Type (CE/PE)	CE (Call Option) + 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 Short Call + Net Premium Received, Lower Breakeven Point = Strike Price of Short Put - Net Premium Received	(Purchase Price of Underlying + Strike Price of Short Put - Net Premium Received) / 2

IRON CONDORS Vs COVERED COMBINATION - When & How to use ?

	IRON CONDORS	COVERED COMBINATION
Market View	Neutral	Bullish
When to use?	When a trader tries to make profit from low volatility in the price of the underlying asset.	This strategy is mainly suited for investors who are moderately bullish on a stock and are comfortable with increasing their position in the event of a price decline.
Action	Sell 1 OTM Put, Buy 1 OTM Put (Lower Strike), Sell 1 OTM Call, Buy 1 OTM Call (Higher Strike)	Sell 1 OTM Call, Sell 1 OTM Put
Breakeven Point	Upper Breakeven Point = Strike Price of Short Call + Net Premium Received, Lower Breakeven Point = Strike Price of Short Put - Net Premium Received	(Purchase Price of Underlying + Strike Price of Short Put - Net Premium Received) / 2

IRON CONDORS Vs COVERED COMBINATION - Risk & Reward

	IRON CONDORS	COVERED COMBINATION
Maximum Profit Scenario	Net Premium Received - Commissions Paid	Strike Price of Short Call - Purchase Price of Underlying + Net Premium Received - Commissions Paid
Maximum Loss Scenario	Strike Price of Long Call - Strike Price of Short Call - Net Premium Received + Commissions Paid	Purchase Price of Underlying + Strike Price of Short Put - (2 x Price of Underlying) - Max Profit + Commissions Paid
Risk	Limited	Unlimited
Reward	Limited	Limited

IRON CONDORS Vs COVERED COMBINATION - Strategy Pros & Cons

	IRON CONDORS	COVERED COMBINATION
Similar Strategies	Long Put Butterfly, Neutral Calendar Spread	Stock Repair Strategy
Disadvantage	• Full of risk. • Unlimited maximum loss.	Combinations can be profitable in sideways or rising markets. Greater combined net credit increases downside protection and potential return.
Advantages	• Chance to gather double premium. • Sure, maximum gains on one-half the trade. • Flexible and double leverage at half price.	Limited Maximum Profit on the upside. Covered Combinations should only be traded on stocks that are bullish.