CHRISTMAS TREE SPREAD WITH PUT OPTION	IRON BUTTERFLY
About Strategy	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..	Iron Butterfly Option Strategy  This strategy is implemented when a trader is bearish on the volatility of market and neutral on the market movements. A trader will buy 1 OTM Put Option, sell 1 ATM Put Option, sell 1 ATM Call Option, buy 1 OTM Call Option. Due to offsetting of long and short positions, this strategy bags limited profit with limited risk. Read more..

CHRISTMAS TREE SPREAD WITH PUT OPTION Vs IRON BUTTERFLY - Details

	CHRISTMAS TREE SPREAD WITH PUT OPTION	IRON BUTTERFLY
Market View	Bearish	Neutral
Type (CE/PE)	CE (Call Option)	CE (Call Option) + PE (Put Option)
Number Of Positions	6	4
Strategy Level	Advance	Advance
Reward Profile	Limited	Limited
Risk Profile	Limited	Limited
Breakeven Point	Lowest strike prices + the half premium – premium paid	Upper Breakeven Point = Strike Price of Short Call + Net Premium Received, Lower Breakeven Point = Strike Price of Short Put - Net Premium Received

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

	CHRISTMAS TREE SPREAD WITH PUT OPTION	IRON BUTTERFLY
Market View	Bearish	Neutral
When to use?	This Strategy is used when an investor wants potential returns.	This strategy is implemented when a trader is bearish on the volatility of market and neutral on the market movements.
Action	Buying one ATM, Selling 3 Puts, Buying one more OTM Put	Buy 1 OTM Put, Sell 1 ATM Put, Sell 1 ATM Call, Buy 1 OTM Call
Breakeven Point	Lowest strike prices + the half premium – premium paid	Upper Breakeven Point = Strike Price of Short Call + Net Premium Received, Lower Breakeven Point = Strike Price of Short Put - Net Premium Received

CHRISTMAS TREE SPREAD WITH PUT OPTION Vs IRON BUTTERFLY - Risk & Reward

	CHRISTMAS TREE SPREAD WITH PUT OPTION	IRON BUTTERFLY
Maximum Profit Scenario	Equal middle strike price – higher strike price – the premium	Net Premium Received - Commissions Paid
Maximum Loss Scenario	Net Debit paid for the strategy.	Strike Price of Long Call - Strike Price of Short Call - Net Premium Received + Commissions Paid
Risk	Limited	Limited
Reward	Limited	Limited

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

	CHRISTMAS TREE SPREAD WITH PUT OPTION	IRON BUTTERFLY
Similar Strategies	Butterfly spreads	Long Put Butterfly, Neutral Calendar Spread
Disadvantage	• Potential profit is lower or limited.	• Large commissions involved. • Probability of losses are higher.
Advantages	• The potential of loss is limited.	• Less amount of capital investment, steady income with low risk. • Traders can predict maximum loss and profit. • Versatile strategy, investors can transform position into bear call spread or bull put spread easily.