PUT BACKSPREAD	SHORT CALL BUTTERFLY
About Strategy	Put Backspread Option Strategy If the trader is bearish on market and bullish in volatility, he will implement this strategy. However the trader can be neutral in nature i.e. indifferent if the market moves in either of the direction, this strategy will make profits, but uptrend will give a capped income than downtrend which will give unlimited returns. Read more..	Short Call Butterfly Option Strategy This strategy is opposite of the Long Call Butterfly Strategy, a trader expects the market to remain range bound in Long Call Butterfly, but here he expects the market to move beyond strike boundaries in Short Call Butterfly. If the trader is bullish on the market’s volatility, he will implement this strategy. Here also there should be equal distance between the .. Read more..

PUT BACKSPREAD Vs SHORT CALL BUTTERFLY - Details

	PUT BACKSPREAD	SHORT CALL BUTTERFLY
Market View	Bearish	Neutral
Type (CE/PE)	PE (Put Option)	CE (Call Option)
Number Of Positions	2	4
Strategy Level	Advance	Advance
Reward Profile		Limited
Risk Profile		Limited
Breakeven Point		Lower Break-even = Lower Strike Price + Net Premium, Upper Break-even = Higher Strike Price - Net Premium

PUT BACKSPREAD Vs SHORT CALL BUTTERFLY - When & How to use ?

	PUT BACKSPREAD	SHORT CALL BUTTERFLY
Market View	Bearish	Neutral
When to use?		This strategy is meant for special scenarios where you foresee a lot of volatility in the market due to election results, budget, policy change, annual result announcements etc.
Action		Buy 2 ATM Call, Sell 1 ITM Call, Sell 1 OTM Call
Breakeven Point		Lower Break-even = Lower Strike Price + Net Premium, Upper Break-even = Higher Strike Price - Net Premium

PUT BACKSPREAD Vs SHORT CALL BUTTERFLY - Risk & Reward

	PUT BACKSPREAD	SHORT CALL BUTTERFLY
Maximum Profit Scenario		The profit is limited to the net premium received.
Maximum Loss Scenario		Higher strike price- Lower Strike Price - Net Premium
Risk	Limited	Limited
Reward	Unlimited	Limited

PUT BACKSPREAD Vs SHORT CALL BUTTERFLY - Strategy Pros & Cons

	PUT BACKSPREAD	SHORT CALL BUTTERFLY
Similar Strategies		Long Straddle, Long Call Butterfly
Disadvantage		• Limited rewards, usually offer smaller return. • Profitability depends on the significant movement of stocks and options prices.
Advantages		• Even if the market is highly volatile, the risk exposure remains limited. • Without any extra investment, you can receive your premium. • Able to book profits even when the price movement cannot be predicted.