RISK REVERSAL	LONG CALL BUTTERFLY
About Strategy	Risk Reversal Option Strategy This strategy protects an investor from unfavourable price movements in the position but limits the profits can be made on that position. A risk reversal is a hedging strategy that protects a long or short position by using put and call options. In this one option is buying and other is written. In this strategy the trader has to pay a premium, while the written option prod Read more..	Long Call Butterfly Option Strategy A trader, who is neutral in nature and believes that there will be very low volatility i.e. expects the market to remain range bound, will implement this strategy. This strategy involves selling of 2 ATM Call Options, buying 1 ITM Call Option & buying 1 OTM Call Option of the same expiry date & same underlying asset. The difference between the strikes sho .. Read more..

RISK REVERSAL Vs LONG CALL BUTTERFLY - Details

	RISK REVERSAL	LONG CALL BUTTERFLY
Market View	Bullish	Neutral
Type (CE/PE)	CE (Call Option) + PE (Put Option)	CE (Call Option)
Number Of Positions	2	4
Strategy Level	Advance	Advance
Reward Profile	Unlimited	Limited
Risk Profile	Unlimited	Limited
Breakeven Point	Premium received - Put Strike Price	Upper Breakeven = Higher Strike Price - Net Premium, Lower Breakeven = Lower Strike Price + Net Premium

RISK REVERSAL Vs LONG CALL BUTTERFLY - When & How to use ?

	RISK REVERSAL	LONG CALL BUTTERFLY
Market View	Bullish	Neutral
When to use?	This strategy can be used for hedging. When an investor want to protect long or short position by using a call and put option.	This strategy should be used when you're expecting no volatility in the price of the underlying.
Action	This strategy work when an investor want to hedge their position by buying a put option and selling a call option.	Sell 2 ATM Call, Buy 1 ITM Call, Buy 1 OTM Call
Breakeven Point	Premium received - Put Strike Price	Upper Breakeven = Higher Strike Price - Net Premium, Lower Breakeven = Lower Strike Price + Net Premium

RISK REVERSAL Vs LONG CALL BUTTERFLY - Risk & Reward

	RISK REVERSAL	LONG CALL BUTTERFLY
Maximum Profit Scenario	You have unlimited profit potential to the upside.	Adjacent strikes - Net premium debit.
Maximum Loss Scenario	You have nearly unlimited downside risk as well because you are short the put	Net Premium Paid
Risk	Unlimited	Limited
Reward	Unlimited	Limited

RISK REVERSAL Vs LONG CALL BUTTERFLY - Strategy Pros & Cons

	RISK REVERSAL	LONG CALL BUTTERFLY
Similar Strategies	-	-
Disadvantage	Unlimited Risk.	• Due to limited lifespan of call options, you can lose the premium paid. • Limited profit which is bound in a narrow range between the two wing strikes.
Advantages	Unlimited profit.	• Under this strategy, a trader can book profit even when there is not volatility in the market. • Limited risks to the net premium paid. • This strategy allows you to gain more profits by investing less and limiting your losses to minimum.