PROTECTIVE CALL	LONG CALL BUTTERFLY
About Strategy	Protective Call Option Strategy This strategy is simply the reversal of the Synthetic Call Strategy. This strategy is implemented when a trader is bearish on the market and expects to go down. Trader will short underlying stock in the cash market and buy either an ATM Call Option or OTM Call Option. The Call Option is bought to protect / hedge the upside risk on the short position. The 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..

PROTECTIVE CALL Vs LONG CALL BUTTERFLY - Details

	PROTECTIVE CALL	LONG CALL BUTTERFLY
Market View	Bearish	Neutral
Type (CE/PE)	CE (Call Option)	CE (Call Option)
Number Of Positions	1	4
Strategy Level	Beginners	Advance
Reward Profile	Unlimited	Limited
Risk Profile	Limited	Limited
Breakeven Point	Sale Price of Underlying + Premium Paid	Upper Breakeven = Higher Strike Price - Net Premium, Lower Breakeven = Lower Strike Price + Net Premium

PROTECTIVE CALL Vs LONG CALL BUTTERFLY - When & How to use ?

	PROTECTIVE CALL	LONG CALL BUTTERFLY
Market View	Bearish	Neutral
When to use?	This strategy is implemented when a trader is bearish on the market and expects to go down.	This strategy should be used when you're expecting no volatility in the price of the underlying.
Action	Buy 1 ATM Call	Sell 2 ATM Call, Buy 1 ITM Call, Buy 1 OTM Call
Breakeven Point	Sale Price of Underlying + Premium Paid	Upper Breakeven = Higher Strike Price - Net Premium, Lower Breakeven = Lower Strike Price + Net Premium

PROTECTIVE CALL Vs LONG CALL BUTTERFLY - Risk & Reward

	PROTECTIVE CALL	LONG CALL BUTTERFLY
Maximum Profit Scenario	Sale Price of Underlying - Price of Underlying - Premium Paid	Adjacent strikes - Net premium debit.
Maximum Loss Scenario	Premium Paid + Call Strike Price - Sale Price of Underlying + Commissions Paid	Net Premium Paid
Risk	Limited	Limited
Reward	Unlimited	Limited

PROTECTIVE CALL Vs LONG CALL BUTTERFLY - Strategy Pros & Cons

	PROTECTIVE CALL	LONG CALL BUTTERFLY
Similar Strategies	Put Backspread, Long Put	-
Disadvantage	• Profitable when market moves as expected. • Not good for beginners.	• 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	• Limited risk if the market moves in opposite direction as expected. • Allows you to keep open a profitable position to make further profits. • Unlimited profit potential.	• 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.