STRAP	SHORT PUT
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..	Short Put Option Strategy A trader will short put if he is bullish in nature and expects the underlying asset not to fall below a certain level. Risk: Losses will be potentially unlimited if the stock skyrockets above the strike price of put. Read more..

STRAP Vs SHORT PUT - Details

	STRAP	SHORT PUT
Market View	Neutral	Bullish
Type (CE/PE)	CE (Call Option) + PE (Put Option)	PE (Put Option)
Number Of Positions	3	1
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	Limited
Risk Profile	Max Loss Occurs When Price of Underlying = Strike Price of Calls/Puts	Unlimited
Breakeven Point	Strike Price of Calls/Puts + (Net Premium Paid/2)	Strike Price - Premium

STRAP Vs SHORT PUT - When & How to use ?

	STRAP	SHORT PUT
Market View	Neutral	Bullish
When to use?	This strategy is used when the investor is bullish on the stock and expects volatility in the near future.	This strategy works well when you're Bullish that the price of the underlying will not fall beyond a certain level.
Action	Buy 2 ATM Call Option, Buy 1 ATM Put Option	Sell Put Option
Breakeven Point	Strike Price of Calls/Puts + (Net Premium Paid/2)	Strike Price - Premium

STRAP Vs SHORT PUT - Risk & Reward

	STRAP	SHORT PUT
Maximum Profit Scenario	UNLIMITED	Premium received in your account when you sell the Put Option.
Maximum Loss Scenario	Net Premium Paid	Unlimited (When the price of the underlying falls.)
Risk	Limited	Unlimited
Reward	Unlimited	Limited

STRAP Vs SHORT PUT - Strategy Pros & Cons

	STRAP	SHORT PUT
Similar Strategies	Strip, Short Put Ladder, Short Call Ladder	Bull Put Spread, Short Starddle
Disadvantage	• To generate profit, there should be significant change in share price. • Expensive strategy.	• Unlimited risk. • Huge losses if the price of the underlying stock falls steeply.
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.	• Benefit from time decay. • Less capital required than buying the stock outright. • Profit when underlying stock price rise, move sideways or drop by a relatively small account.