STRAP	CHRISTMAS TREE SPREAD WITH PUT OPTION
About Strategy	Strap Option Strategy  Strap Strategy is similar to Long Straddle, the only difference is the quantity traded. A trader will buy two Call Options and one Put Options. In this strategy, a trader is very bullish on the market and volatility on upside but wants to hedge himself in case the stock doesn’t perform as per his expectations. This strategy will make more profits compared to long straddle sin Read more..	Christmas Tree Spread with Puts Option Strategy This Strategy is an advance option strategy that consists of three legs and six total options. In this strategy buying one put at strike price D, skipping strike price C, writes three calls at strike price B, and buying two calls at strike price A for same expiration dates for neutral to bearish forecast. An investor used this strategy to potential returns .. Read more..

STRAP Vs CHRISTMAS TREE SPREAD WITH PUT OPTION - Details

	STRAP	CHRISTMAS TREE SPREAD WITH PUT OPTION
Market View	Neutral	Bearish
Type (CE/PE)	CE (Call Option) + PE (Put Option)	CE (Call Option)
Number Of Positions	3	6
Strategy Level	Beginners	Advance
Reward Profile	Profit Achieved When Price of Underlying > Strike Price of Calls/Puts + (Net Premium Paid/2) OR Price of Underlying < Strike Price of Calls/Puts - Net Premium Paid	Limited
Risk Profile	Max Loss Occurs When Price of Underlying = Strike Price of Calls/Puts	Limited
Breakeven Point	Strike Price of Calls/Puts + (Net Premium Paid/2)	Lowest strike prices + the half premium – premium paid

STRAP Vs CHRISTMAS TREE SPREAD WITH PUT OPTION - When & How to use ?

	STRAP	CHRISTMAS TREE SPREAD WITH PUT OPTION
Market View	Neutral	Bearish
When to use?	This strategy is used when the investor is bullish on the stock and expects volatility in the near future.	This Strategy is used when an investor wants potential returns.
Action	Buy 2 ATM Call Option, Buy 1 ATM Put Option	Buying one ATM, Selling 3 Puts, Buying one more OTM Put
Breakeven Point	Strike Price of Calls/Puts + (Net Premium Paid/2)	Lowest strike prices + the half premium – premium paid

STRAP Vs CHRISTMAS TREE SPREAD WITH PUT OPTION - Risk & Reward

	STRAP	CHRISTMAS TREE SPREAD WITH PUT OPTION
Maximum Profit Scenario	UNLIMITED	Equal middle strike price – higher strike price – the premium
Maximum Loss Scenario	Net Premium Paid	Net Debit paid for the strategy.
Risk	Limited	Limited
Reward	Unlimited	Limited

STRAP Vs CHRISTMAS TREE SPREAD WITH PUT OPTION - Strategy Pros & Cons

	STRAP	CHRISTMAS TREE SPREAD WITH PUT OPTION
Similar Strategies	Strip, Short Put Ladder, Short Call Ladder	Butterfly spreads
Disadvantage	• To generate profit, there should be significant change in share price. • Expensive strategy.	• Potential profit is lower or limited.
Advantages	• Limited loss. • If share prices are moving then traders can book unlimited profit. • A trader can still book profit if the underlying falls substantially.	• The potential of loss is limited.