PROTECTIVE COLLAR	LONG CALL BUTTERFLY
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 Call Butterfly Option Strategy A trader, who is neutral in nature and believes that there will be very low volatility i.e. expects the market to remain range bound, will implement this strategy. This strategy involves selling of 2 ATM Call Options, buying 1 ITM Call Option & buying 1 OTM Call Option of the same expiry date & same underlying asset. The difference between the strikes sho .. Read more..

PROTECTIVE COLLAR Vs LONG CALL BUTTERFLY - Details

	PROTECTIVE COLLAR	LONG CALL BUTTERFLY
Market View	Neutral	Neutral
Type (CE/PE)	CE (Call Option) + PE (Put Option)	CE (Call Option)
Number Of Positions	2	4
Strategy Level	Beginners	Advance
Reward Profile	Limited	Limited
Risk Profile	Limited	Limited
Breakeven Point	Purchase Price of Underlying + Net Premium Paid	Upper Breakeven = Higher Strike Price - Net Premium, Lower Breakeven = Lower Strike Price + Net Premium

PROTECTIVE COLLAR Vs LONG CALL BUTTERFLY - When & How to use ?

	PROTECTIVE COLLAR	LONG CALL BUTTERFLY
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 strategy should be used when you're expecting no volatility in the price of the underlying.
Action	• Short 1 Call Option, • Long 1 Put Option	Sell 2 ATM Call, Buy 1 ITM Call, Buy 1 OTM Call
Breakeven Point	Purchase Price of Underlying + Net Premium Paid	Upper Breakeven = Higher Strike Price - Net Premium, Lower Breakeven = Lower Strike Price + Net Premium

PROTECTIVE COLLAR Vs LONG CALL BUTTERFLY - Risk & Reward

	PROTECTIVE COLLAR	LONG CALL BUTTERFLY
Maximum Profit Scenario	• Call strike - stock purchase price - net premium paid + net credit received	Adjacent strikes - Net premium debit.
Maximum Loss Scenario	• Stock purchase price - put strike - net premium paid - put strike + net credit received	Net Premium Paid
Risk	Limited	Limited
Reward	Limited	Limited

PROTECTIVE COLLAR Vs LONG CALL BUTTERFLY - Strategy Pros & Cons

	PROTECTIVE COLLAR	LONG CALL BUTTERFLY
Similar Strategies	Bull Put Spread, Bull Call Spread	-
Disadvantage	• Potential profit is lower or limited.	• Due to limited lifespan of call options, you can lose the premium paid. • Limited profit which is bound in a narrow range between the two wing strikes.
Advantages	The Risk is limited.	• Under this strategy, a trader can book profit even when there is not volatility in the market. • Limited risks to the net premium paid. • This strategy allows you to gain more profits by investing less and limiting your losses to minimum.