LONG CALL BUTTERFLY	COVERED PUT
About Strategy	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..	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 CALL BUTTERFLY Vs COVERED PUT - Details

	LONG CALL BUTTERFLY	COVERED PUT
Market View	Neutral	Bearish
Type (CE/PE)	CE (Call Option)	PE (Put Option) + Underlying
Number Of Positions	4	2
Strategy Level	Advance	Advance
Reward Profile	Limited	Limited
Risk Profile	Limited	Unlimited
Breakeven Point	Upper Breakeven = Higher Strike Price - Net Premium, Lower Breakeven = Lower Strike Price + Net Premium	Futures Price + Premium Received

LONG CALL BUTTERFLY Vs COVERED PUT - When & How to use ?

	LONG CALL BUTTERFLY	COVERED PUT
Market View	Neutral	Bearish
When to use?	This strategy should be used when you're expecting no volatility in the price of the underlying.	The Covered Put works well when the market is moderately Bearish.
Action	Sell 2 ATM Call, Buy 1 ITM Call, Buy 1 OTM Call	Sell Underlying Sell OTM Put Option
Breakeven Point	Upper Breakeven = Higher Strike Price - Net Premium, Lower Breakeven = Lower Strike Price + Net Premium	Futures Price + Premium Received

LONG CALL BUTTERFLY Vs COVERED PUT - Risk & Reward

	LONG CALL BUTTERFLY	COVERED PUT
Maximum Profit Scenario	Adjacent strikes - Net premium debit.	The profit happens when the price of the underlying moves above strike price of Short Put.
Maximum Loss Scenario	Net Premium Paid	Price of Underlying - Sale Price of Underlying - Premium Received
Risk	Limited	Unlimited
Reward	Limited	Limited

LONG CALL BUTTERFLY Vs COVERED PUT - Strategy Pros & Cons

	LONG CALL BUTTERFLY	COVERED PUT
Similar Strategies	-	Bear Put Spread, Bear Call Spread
Disadvantage	• 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.	• Limited profit, unlimited risk. • Trader should have enough experience before using this strategy.
Advantages	• 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.	• 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.