LONG STRANGLE	COVERED 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..	Covered Put Option Strategy  This strategy is exactly opposite to Covered Call Strategy. Here the investor is neutral or moderately bearish in nature and wants to take advantage of the price fall in the near future. The trader will short one lot of stock future. Now the trader will short ATM Put Option, the option strike price will be his exit price. If the prices rally above the strike price, the .. Read more..

LONG STRANGLE Vs COVERED PUT - Details

	LONG STRANGLE	COVERED PUT
Market View	Neutral	Bearish
Type (CE/PE)	CE (Call Option) + PE (Put Option)	PE (Put Option) + Underlying
Number Of Positions	2	2
Strategy Level	Beginners	Advance
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	Futures Price + Premium Received

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

	LONG STRANGLE	COVERED PUT
Market View	Neutral	Bearish
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.	The Covered Put works well when the market is moderately Bearish.
Action	Buy OTM Call Option, Buy OTM Put Option	Sell Underlying Sell OTM Put Option
Breakeven Point	Lower Breakeven Point = Strike Price of Put - Net Premium, Upper Breakeven Point = Strike Price of Call + Net Premium	Futures Price + Premium Received

LONG STRANGLE Vs COVERED PUT - Risk & Reward

	LONG STRANGLE	COVERED PUT
Maximum Profit Scenario	Profit = Price of Underlying - Strike Price of Long Call - Net Premium Paid	The profit happens when the price of the underlying moves above strike price of Short Put.
Maximum Loss Scenario	Max Loss = Net Premium Paid	Price of Underlying - Sale Price of Underlying - Premium Received
Risk	Limited	Unlimited
Reward	Unlimited	Limited

LONG STRANGLE Vs COVERED PUT - Strategy Pros & Cons

	LONG STRANGLE	COVERED PUT
Similar Strategies	Long Straddle, Short Strangle	Bear Put Spread, Bear Call Spread
Disadvantage	• Require significant price movement to book profit. • Traders can lose more money if the underlying asset stayed stagnant.	• Limited profit, unlimited risk. • Trader should have enough experience before using this strategy.
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 .	• Investors can book profit when underlying stock price drop, move sideways or rises by a small amount. • Able to generate monthly income. • Able to generate profit from fall in prices or mild increase in the prices.