THE COLLAR	SHORT GUTS
About Strategy	The Collar Option Strategy Collar Strategy is an extension to Covered Call Strategy. A trader, who is bullish in nature but has a very low risk appetite and wants to mitigate his risk will implement the Collar Strategy. Collar involves buying of stock in either Cash/Futures Market, buying an ATM Put Option & selling an OTM Call Option. The expiry dates of the op 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..

THE COLLAR Vs SHORT GUTS - Details

	THE COLLAR	SHORT GUTS
Market View	Bullish	Neutral
Type (CE/PE)	CE (Call Option) + PE (Put Option) + Underlying	CE (Call Option) + PE (Put Option)
Number Of Positions	3	2
Strategy Level	Advance	Beginners
Reward Profile	Limited	Limited
Risk Profile	Limited	Unlimited
Breakeven Point	Price of Features - Call Premium + Put Premium	Upper Breakeven Point = Net Premium Received + Strike Price of Short Call, Lower Breakeven Point = Strike Price of Short Put - Net Premium Received

THE COLLAR Vs SHORT GUTS - When & How to use ?

	THE COLLAR	SHORT GUTS
Market View	Bullish	Neutral
When to use?	It should be used only in case where trader is certain about the bearish market view.	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	Buy Underlying, Buy 1 ATM Put Option, Sell 1 OTM Call Option	Sell 1 ITM Call, Sell 1 ITM Put
Breakeven Point	Price of Features - Call Premium + Put Premium	Upper Breakeven Point = Net Premium Received + Strike Price of Short Call, Lower Breakeven Point = Strike Price of Short Put - Net Premium Received

THE COLLAR Vs SHORT GUTS - Risk & Reward

	THE COLLAR	SHORT GUTS
Maximum Profit Scenario	Strike Price of Short Call - Purchase Price of Underlying + Net Premium Received	Net Premium Received + Strike Price of Short Put - Strike Price of Short Call - Commissions Paid
Maximum Loss Scenario	Purchase Price of Underlying - Strike Price of Long Put - Net Premium Received	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

THE COLLAR Vs SHORT GUTS - Strategy Pros & Cons

	THE COLLAR	SHORT GUTS
Similar Strategies	Call Spread, Bull Put Spread	Short Strangle (Sell Strangle), Short Straddle (Sell Straddle)
Disadvantage	• Limited profit. • A trader can book more profit without this strategy if the prices goes high.	• Unlimited potential loss if the underlying stock continues to move in one direction. • High margin required.
Advantages	• This strategy protects the losses on underlying asset. • Risk gets limited if the price of the stocks goes down. • Trader can get ownership benefits life dividend and voting rights.	• 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.