PROTECTIVE COLLAR	LONG STRADDLE
About Strategy	Protective Collar Strategy This Strategy is implemented when the investor requires downside protection for the short - to medium term but at lower cost. Buying protective puts can be an expensive proposition and writing OTM calls can defray the cost of the puts quite substantially. Protective Collar is considered as bearish to neutral strategy. In this strategy risk and reward is both are limited. This Read more..	Long Straddle Option Strategy  Straddle is neither bullish nor bearish strategy; it is a market neutral strategy. Here a trader wishes to take advantage of the volatility in the market. This strategy involves buying of one Call option and one Put option of the same strike price, same expiry date and of the same underlying asset. Now a trader is bound to make profits once stock moves in either direc .. Read more..

PROTECTIVE COLLAR Vs LONG STRADDLE - Details

	PROTECTIVE COLLAR	LONG STRADDLE
Market View	Neutral	Neutral
Type (CE/PE)	CE (Call Option) + PE (Put Option)	CE (Call Option) + PE (Put Option)
Number Of Positions	2	2
Strategy Level	Beginners	Beginners
Reward Profile	Limited	Unlimited
Risk Profile	Limited	Limited
Breakeven Point	Purchase Price of Underlying + Net Premium Paid	Lower Breakeven = Strike Price of Put - Net Premium, Upper breakeven = Strike Price of Call + Net Premium

PROTECTIVE COLLAR Vs LONG STRADDLE - When & How to use ?

	PROTECTIVE COLLAR	LONG STRADDLE
Market View	Neutral	Neutral
When to use?	This Strategy is implemented when the investor requires downside protection for the short - to medium term but at lower cost.	This options strategy is work well when and investor market view is bearish. The strategy minimizes your risk in the event of prime movements going against your expectations.
Action	• Short 1 Call Option, • Long 1 Put Option	Buy Call Option, Buy Put Option
Breakeven Point	Purchase Price of Underlying + Net Premium Paid	Lower Breakeven = Strike Price of Put - Net Premium, Upper breakeven = Strike Price of Call + Net Premium

PROTECTIVE COLLAR Vs LONG STRADDLE - Risk & Reward

	PROTECTIVE COLLAR	LONG STRADDLE
Maximum Profit Scenario	• Call strike - stock purchase price - net premium paid + net credit received	Max profit is achieved when at one option is exercised.
Maximum Loss Scenario	• Stock purchase price - put strike - net premium paid - put strike + net credit received	Maximum Loss = Net Premium Paid
Risk	Limited	Limited
Reward	Limited	Unlimited

PROTECTIVE COLLAR Vs LONG STRADDLE - Strategy Pros & Cons

	PROTECTIVE COLLAR	LONG STRADDLE
Similar Strategies	Bull Put Spread, Bull Call Spread	Bear Put Spread
Disadvantage	• Potential profit is lower or limited.	• There should be continuous movement of the stock and options price for this strategy to be profitable. • Time decay hurts long option if the strike price, expiration date or underlying stock are badly chosen.
Advantages	The Risk is limited.	• Unlimited potential beyond the breakeven point in either direction . • Book your profit from highly volatile stocks without determining the direction. • Limited risk, more profit.