STRAP	STRIP
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..	Strip Option Strategy Strip Strategy is the opposite of Strap Strategy. When a trader is bearish on the market and bullish on volatility then he will implement this strategy by buying two ATM Put Options & one ATM Call Option, of the same strike price, expiry date & underlying asset. If the prices move downwards then this strategy will make more profits compared to short straddle because of the .. Read more..

STRAP Vs STRIP - Details

	STRAP	STRIP
Market View	Neutral	Neutral
Type (CE/PE)	CE (Call Option) + PE (Put Option)	CE (Call Option) + PE (Put Option)
Number Of Positions	3	3
Strategy Level	Beginners	Beginners
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	Unlimited
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)	Upper Breakeven Point = Strike Price of Calls/Puts + Net Premium Paid, Lower Breakeven Point = Strike Price of Calls/Puts - (Net Premium Paid/2)

STRAP Vs STRIP - When & How to use ?

	STRAP	STRIP
Market View	Neutral	Neutral
When to use?	This strategy is used when the investor is bullish on the stock and expects volatility in the near future.	When a trader is bearish on the market and bullish on volatility then he will implement this strategy.
Action	Buy 2 ATM Call Option, Buy 1 ATM Put Option	Buy 1 ATM Call, Buy 2 ATM Puts
Breakeven Point	Strike Price of Calls/Puts + (Net Premium Paid/2)	Upper Breakeven Point = Strike Price of Calls/Puts + Net Premium Paid, Lower Breakeven Point = Strike Price of Calls/Puts - (Net Premium Paid/2)

STRAP Vs STRIP - Risk & Reward

	STRAP	STRIP
Maximum Profit Scenario	UNLIMITED	Price of Underlying - Strike Price of Calls - Net Premium Paid OR 2 x (Strike Price of Puts - Price of Underlying) - Net Premium Paid
Maximum Loss Scenario	Net Premium Paid	Net Premium Paid + Commissions Paid
Risk	Limited	Limited
Reward	Unlimited	Unlimited

STRAP Vs STRIP - Strategy Pros & Cons

	STRAP	STRIP
Similar Strategies	Strip, Short Put Ladder, Short Call Ladder	Strap, Short Put Ladder
Disadvantage	• To generate profit, there should be significant change in share price. • Expensive strategy.	Expensive., The share price must change significantly to generate profit., High Bid/Offer spread can have a negative influence on the position.
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.	Profit is generated when the share price changes in any direction., Limited loss., The profit is potentially unlimited when share prices are moving.