PROTECTIVE COLLAR	REVERSE IRON 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..	Reverse Iron Butterfly Option Strategy Reverse Iron Butterfly as the name suggests is the opposite of Iron Butterfly. In Reverse Iron Butterfly, a trader is bullish on volatility and expects the market to make significant move in the near future in either directions. Here a trader will buy 1 ATM Call Option, sell 1 OTM Call Option, buy 1 ATM Put Option, sell 1 OTM Put Option. This strategy also bags lim .. Read more..

PROTECTIVE COLLAR Vs REVERSE IRON BUTTERFLY - Details

	PROTECTIVE COLLAR	REVERSE IRON BUTTERFLY
Market View	Neutral	Neutral
Type (CE/PE)	CE (Call Option) + PE (Put Option)	CE (Call Option) + PE (Put 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 Point = Strike Price of Long Call + Net Premium Paid, Lower Breakeven Point = Strike Price of Long Put - Net Premium Paid

PROTECTIVE COLLAR Vs REVERSE IRON BUTTERFLY - When & How to use ?

	PROTECTIVE COLLAR	REVERSE IRON 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 is used when a trader is bullish on volatility and expects the market to make significant move in the near future in either directions.
Action	• Short 1 Call Option, • Long 1 Put Option	Sell 1 OTM Put, Buy 1 ATM Put, Buy 1 ATM Call, Sell 1 OTM Call
Breakeven Point	Purchase Price of Underlying + Net Premium Paid	Upper Breakeven Point = Strike Price of Long Call + Net Premium Paid, Lower Breakeven Point = Strike Price of Long Put - Net Premium Paid

PROTECTIVE COLLAR Vs REVERSE IRON BUTTERFLY - Risk & Reward

	PROTECTIVE COLLAR	REVERSE IRON BUTTERFLY
Maximum Profit Scenario	• Call strike - stock purchase price - net premium paid + net credit received	Strike Price of Short Call (or Long Put) - Strike Price of Long Call (or Short Put) - Net Premium Paid - Commissions Paid
Maximum Loss Scenario	• Stock purchase price - put strike - net premium paid - put strike + net credit received	Net Premium Paid + Commissions Paid
Risk	Limited	Limited
Reward	Limited	Limited

PROTECTIVE COLLAR Vs REVERSE IRON BUTTERFLY - Strategy Pros & Cons

	PROTECTIVE COLLAR	REVERSE IRON BUTTERFLY
Similar Strategies	Bull Put Spread, Bull Call Spread	Short Put Butterfly, Short Condor
Disadvantage	• Potential profit is lower or limited.	• Potential loss is higher than gain, complex strategy. • Not suitable for beginners.
Advantages	The Risk is limited.	• Able to profit whether stocks move in either direction up or down. • This strategy can be used by option traders who cannot use credit spreads. • Predictable maximum loss and profits, volatile strategy.