PROTECTIVE CALL	IRON BUTTERFLY
About Strategy	Protective Call Option Strategy This strategy is simply the reversal of the Synthetic Call Strategy. This strategy is implemented when a trader is bearish on the market and expects to go down. Trader will short underlying stock in the cash market and buy either an ATM Call Option or OTM Call Option. The Call Option is bought to protect / hedge the upside risk on the short position. The Read more..	Iron Butterfly Option Strategy  This strategy is implemented when a trader is bearish on the volatility of market and neutral on the market movements. A trader will buy 1 OTM Put Option, sell 1 ATM Put Option, sell 1 ATM Call Option, buy 1 OTM Call Option. Due to offsetting of long and short positions, this strategy bags limited profit with limited risk. Read more..

PROTECTIVE CALL Vs IRON BUTTERFLY - Details

	PROTECTIVE CALL	IRON BUTTERFLY
Market View	Bearish	Neutral
Type (CE/PE)	CE (Call Option)	CE (Call Option) + PE (Put Option)
Number Of Positions	1	4
Strategy Level	Beginners	Advance
Reward Profile	Unlimited	Limited
Risk Profile	Limited	Limited
Breakeven Point	Sale Price of Underlying + Premium Paid	Upper Breakeven Point = Strike Price of Short Call + Net Premium Received, Lower Breakeven Point = Strike Price of Short Put - Net Premium Received

PROTECTIVE CALL Vs IRON BUTTERFLY - When & How to use ?

	PROTECTIVE CALL	IRON BUTTERFLY
Market View	Bearish	Neutral
When to use?	This strategy is implemented when a trader is bearish on the market and expects to go down.	This strategy is implemented when a trader is bearish on the volatility of market and neutral on the market movements.
Action	Buy 1 ATM Call	Buy 1 OTM Put, Sell 1 ATM Put, Sell 1 ATM Call, Buy 1 OTM Call
Breakeven Point	Sale Price of Underlying + Premium Paid	Upper Breakeven Point = Strike Price of Short Call + Net Premium Received, Lower Breakeven Point = Strike Price of Short Put - Net Premium Received

PROTECTIVE CALL Vs IRON BUTTERFLY - Risk & Reward

	PROTECTIVE CALL	IRON BUTTERFLY
Maximum Profit Scenario	Sale Price of Underlying - Price of Underlying - Premium Paid	Net Premium Received - Commissions Paid
Maximum Loss Scenario	Premium Paid + Call Strike Price - Sale Price of Underlying + Commissions Paid	Strike Price of Long Call - Strike Price of Short Call - Net Premium Received + Commissions Paid
Risk	Limited	Limited
Reward	Unlimited	Limited

PROTECTIVE CALL Vs IRON BUTTERFLY - Strategy Pros & Cons

	PROTECTIVE CALL	IRON BUTTERFLY
Similar Strategies	Put Backspread, Long Put	Long Put Butterfly, Neutral Calendar Spread
Disadvantage	• Profitable when market moves as expected. • Not good for beginners.	• Large commissions involved. • Probability of losses are higher.
Advantages	• Limited risk if the market moves in opposite direction as expected. • Allows you to keep open a profitable position to make further profits. • Unlimited profit potential.	• Less amount of capital investment, steady income with low risk. • Traders can predict maximum loss and profit. • Versatile strategy, investors can transform position into bear call spread or bull put spread easily.