RATIO PUT WRITE	THE COLLAR
About Strategy	Ratio Put Write Option Strategy  This strategy is implemented by selling (short) the underlying asset in the cash/futures market. Simultaneously, sell ATM Puts double the number of long quantity. This strategy is used by a trader who in neutral on the market and bearish on the volatility in the near future. Here profits will be capped up to the premium amount and risk will be potentially unlimited. Read more..	The Collar Option Strategy Collar Strategy is an extension to Covered Call Strategy. A trader, who is bullish in nature but has a very low risk appetite and wants to mitigate his risk will implement the Collar Strategy. Collar involves buying of stock in either Cash/Futures Market, buying an ATM Put Option & selling an OTM Call Option. The expiry dates of the op .. Read more..

RATIO PUT WRITE Vs THE COLLAR - Details

	RATIO PUT WRITE	THE COLLAR
Market View	Neutral	Bullish
Type (CE/PE)	PE (Put Option)	CE (Call Option) + PE (Put Option) + Underlying
Number Of Positions	2	3
Strategy Level	Beginners	Advance
Reward Profile	Max Profit Achieved When Price of Underlying = Strike Price of Short Puts	Limited
Risk Profile	Loss Occurs When Price of Underlying < Strike Price of Short Put - Net Premium Received OR Price of Underlying > Strike Price of Short Put + Net Premium Received	Limited
Breakeven Point	Upper Breakeven Point = Strike Price of Short Puts + Points of Maximum Profit Lower Breakeven Point = Strike Price of Short Puts - Points of Maximum Profit	Price of Features - Call Premium + Put Premium

RATIO PUT WRITE Vs THE COLLAR - When & How to use ?

	RATIO PUT WRITE	THE COLLAR
Market View	Neutral	Bullish
When to use?	This strategy is implemented by selling (short) the underlying asset in the cash/futures market. This strategy is used by a trader who in neutral on the market and bearish on the volatility in the near future	It should be used only in case where trader is certain about the bearish market view.
Action	Sell 2 ATM Puts	Buy Underlying, Buy 1 ATM Put Option, Sell 1 OTM Call Option
Breakeven Point	Upper Breakeven Point = Strike Price of Short Puts + Points of Maximum Profit Lower Breakeven Point = Strike Price of Short Puts - Points of Maximum Profit	Price of Features - Call Premium + Put Premium

RATIO PUT WRITE Vs THE COLLAR - Risk & Reward

	RATIO PUT WRITE	THE COLLAR
Maximum Profit Scenario	Net Premium Received - Commissions Paid	Strike Price of Short Call - Purchase Price of Underlying + Net Premium Received
Maximum Loss Scenario	Price of Underlying - Sale Price of Underlying - Net Premium Received OR Strike Price of Short Put - Price of Underlying - Net Premium Received + Commissions Paid	Purchase Price of Underlying - Strike Price of Long Put - Net Premium Received
Risk	Unlimited	Limited
Reward	Limited	Limited

RATIO PUT WRITE Vs THE COLLAR - Strategy Pros & Cons

	RATIO PUT WRITE	THE COLLAR
Similar Strategies	Short Strangle and Short Straddle	Call Spread, Bull Put Spread
Disadvantage	• Potential loss is higher than gain. • Limited profit.	• Limited profit. • A trader can book more profit without this strategy if the prices goes high.
Advantages		• This strategy protects the losses on underlying asset. • Risk gets limited if the price of the stocks goes down. • Trader can get ownership benefits life dividend and voting rights.