THE COLLAR	RATIO PUT SPREAD
About Strategy	The Collar Option Strategy Collar Strategy is an extension to Covered Call Strategy. A trader, who is bullish in nature but has a very low risk appetite and wants to mitigate his risk will implement the Collar Strategy. Collar involves buying of stock in either Cash/Futures Market, buying an ATM Put Option & selling an OTM Call Option. The expiry dates of the op Read more..	Ratio Put Spread Option Strategy  This strategy involves buying ITM Puts and simultaneously selling OTM Puts, double the number of ITM Puts. This strategy is used by a trader who is neutral on the market and bearish on the volatility in the near future. Here profits will be capped up to the premium amount and risk will be potentially unlimited. Read more..

THE COLLAR Vs RATIO PUT SPREAD - Details

	THE COLLAR	RATIO PUT SPREAD
Market View	Bullish	Neutral
Type (CE/PE)	CE (Call Option) + PE (Put Option) + Underlying	PE (Put Option)
Number Of Positions	3	3
Strategy Level	Advance	Beginners
Reward Profile	Limited	Limited
Risk Profile	Limited	Unlimited
Breakeven Point	Price of Features - Call Premium + Put Premium	Upper Breakeven Point = Strike Price of Long Put +/- Net Premium Received or Paid, Lower Breakeven Point = Strike Price of Short Puts - (Points of Maximum Profit / Number of Uncovered Puts)

THE COLLAR Vs RATIO PUT SPREAD - When & How to use ?

	THE COLLAR	RATIO PUT SPREAD
Market View	Bullish	Neutral
When to use?	It should be used only in case where trader is certain about the bearish market view.	This strategy is used by a trader who is neutral on the market and bearish on the volatility in the near future.
Action	Buy Underlying, Buy 1 ATM Put Option, Sell 1 OTM Call Option	Buy 1 ITM Put, Sell 2 OTM Puts
Breakeven Point	Price of Features - Call Premium + Put Premium	Upper Breakeven Point = Strike Price of Long Put +/- Net Premium Received or Paid, Lower Breakeven Point = Strike Price of Short Puts - (Points of Maximum Profit / Number of Uncovered Puts)

THE COLLAR Vs RATIO PUT SPREAD - Risk & Reward

	THE COLLAR	RATIO PUT SPREAD
Maximum Profit Scenario	Strike Price of Short Call - Purchase Price of Underlying + Net Premium Received	Strike Price of Long Put - Strike Price of Short Put + Net Premium Received - Commissions Paid
Maximum Loss Scenario	Purchase Price of Underlying - Strike Price of Long Put - Net Premium Received	Strike Price of Short - Price of Underlying - Max Profit + Commissions Paid
Risk	Limited	Unlimited
Reward	Limited	Limited

THE COLLAR Vs RATIO PUT SPREAD - Strategy Pros & Cons

	THE COLLAR	RATIO PUT SPREAD
Similar Strategies	Call Spread, Bull Put Spread	Short Straddle (Sell Straddle), Short Strangle (Sell Strangle)
Disadvantage	• Limited profit. • A trader can book more profit without this strategy if the prices goes high.	• Unlimited potential risk. • Limited profit.
Advantages	• This strategy protects the losses on underlying asset. • Risk gets limited if the price of the stocks goes down. • Trader can get ownership benefits life dividend and voting rights.	• Directional strategy so that there is either no upside or downside risk. • Able to profit even if trader is neutral on the market. • Higher probability of profit.