CHRISTMAS TREE SPREAD WITH PUT OPTION	SHORT GUTS
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..	Short Guts Option Strategy  This strategy is implemented by a trader when he is neutral on the movements and bearish on volatility i.e. he expects the stock to be range bound in the near future. This strategy involves sale of 1 ITM Call Option and 1 ITM Put Option. This strategy can be called as Credit Spread since his account is credited at the time of entering in the positions. < .. Read more..

CHRISTMAS TREE SPREAD WITH PUT OPTION Vs SHORT GUTS - Details

	CHRISTMAS TREE SPREAD WITH PUT OPTION	SHORT GUTS
Market View	Bearish	Neutral
Type (CE/PE)	CE (Call Option)	CE (Call Option) + PE (Put Option)
Number Of Positions	6	2
Strategy Level	Advance	Beginners
Reward Profile	Limited	Limited
Risk Profile	Limited	Unlimited
Breakeven Point	Lowest strike prices + the half premium – premium paid	Upper Breakeven Point = Net Premium Received + Strike Price of Short Call, Lower Breakeven Point = Strike Price of Short Put - Net Premium Received

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

	CHRISTMAS TREE SPREAD WITH PUT OPTION	SHORT GUTS
Market View	Bearish	Neutral
When to use?	This Strategy is used when an investor wants potential returns.	This strategy is implemented by a trader when he is neutral on the movements and bearish on volatility i.e. he expects the stock to be range bound in the near future.
Action	Buying one ATM, Selling 3 Puts, Buying one more OTM Put	Sell 1 ITM Call, Sell 1 ITM Put
Breakeven Point	Lowest strike prices + the half premium – premium paid	Upper Breakeven Point = Net Premium Received + Strike Price of Short Call, Lower Breakeven Point = Strike Price of Short Put - Net Premium Received

CHRISTMAS TREE SPREAD WITH PUT OPTION Vs SHORT GUTS - Risk & Reward

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

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

	CHRISTMAS TREE SPREAD WITH PUT OPTION	SHORT GUTS
Similar Strategies	Butterfly spreads	Short Strangle (Sell Strangle), Short Straddle (Sell Straddle)
Disadvantage	• Potential profit is lower or limited.	• Unlimited potential loss if the underlying stock continues to move in one direction. • High margin required.
Advantages	• The potential of loss is limited.	• Ability to profit even when underlying asset stays stagnant. • You are already paid your full profit the moment the position is put on as this is a credit spread position. • Higher chance of ending in full profit as compared to short strangle or short straddle.