LONG STRANGLE	SHORT PUT
About Strategy	Long Strangle Option Strategy A Strangle is similar to Straddle. In Strangle, a trader will purchase one OTM Call Option and one OTM Put Option, of the same expiry date and the same underlying asset. This strategy will reduce the entry cost for trader and it is also cheaper than straddle. A trader will make profits, if the market moves sharply in either direction and gives extra-ordinary returns in the 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..

LONG STRANGLE Vs SHORT PUT - Details

	LONG STRANGLE	SHORT PUT
Market View	Neutral	Bullish
Type (CE/PE)	CE (Call Option) + PE (Put Option)	PE (Put Option)
Number Of Positions	2	1
Strategy Level	Beginners	Beginners
Reward Profile	Unlimited	Limited
Risk Profile	Limited	Unlimited
Breakeven Point	Lower Breakeven Point = Strike Price of Put - Net Premium, Upper Breakeven Point = Strike Price of Call + Net Premium	Strike Price - Premium

LONG STRANGLE Vs SHORT PUT - When & How to use ?

	LONG STRANGLE	SHORT PUT
Market View	Neutral	Bullish
When to use?	This strategy is used in special scenarios where you foresee a lot of volatility in the market due to election results, budget, policy change, annual result announcements etc.	This strategy works well when you're Bullish that the price of the underlying will not fall beyond a certain level.
Action	Buy OTM Call Option, Buy OTM Put Option	Sell Put Option
Breakeven Point	Lower Breakeven Point = Strike Price of Put - Net Premium, Upper Breakeven Point = Strike Price of Call + Net Premium	Strike Price - Premium

LONG STRANGLE Vs SHORT PUT - Risk & Reward

	LONG STRANGLE	SHORT PUT
Maximum Profit Scenario	Profit = Price of Underlying - Strike Price of Long Call - Net Premium Paid	Premium received in your account when you sell the Put Option.
Maximum Loss Scenario	Max Loss = Net Premium Paid	Unlimited (When the price of the underlying falls.)
Risk	Limited	Unlimited
Reward	Unlimited	Limited

LONG STRANGLE Vs SHORT PUT - Strategy Pros & Cons

	LONG STRANGLE	SHORT PUT
Similar Strategies	Long Straddle, Short Strangle	Bull Put Spread, Short Starddle
Disadvantage	• Require significant price movement to book profit. • Traders can lose more money if the underlying asset stayed stagnant.	• Unlimited risk. • Huge losses if the price of the underlying stock falls steeply.
Advantages	• Able to book profit, no matter if the underlying asset goes in either direction. • Limited loss to the debit paid. • If the underlying asset continues to move in one direction then you can book Unlimited profit .	• 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.