LONG STRANGLE	LONG GUTS
About Strategy	Long Strangle Option Strategy A Strangle is similar to Straddle. In Strangle, a trader will purchase one OTM Call Option and one OTM Put Option, of the same expiry date and the same underlying asset. This strategy will reduce the entry cost for trader and it is also cheaper than straddle. A trader will make profits, if the market moves sharply in either direction and gives extra-ordinary returns in the Read more..	Long Guts Option Strategy  This strategy is implemented by a trader when he is neutral on the movements and bullish on volatility i.e. he expects the stock to move in either direction with high magnitude. This strategy involves buying 1 ITM Call Option and 1 ITM Put Option. This strategy can be called as Debit Spread because trader’s account is debited at the time of entering the positions.< .. Read more..

LONG STRANGLE Vs LONG GUTS - Details

	LONG STRANGLE	LONG GUTS
Market View	Neutral	Neutral
Type (CE/PE)	CE (Call Option) + PE (Put Option)	CE (Call Option) + PE (Put Option)
Number Of Positions	2	2
Strategy Level	Beginners	Beginners
Reward Profile	Unlimited	Unlimited
Risk Profile	Limited	Limited
Breakeven Point	Lower Breakeven Point = Strike Price of Put - Net Premium, Upper Breakeven Point = Strike Price of Call + Net Premium	Upper Breakeven Point = Net Premium Paid + Strike Price of Long Call, Lower Breakeven Point = Strike Price of Long Put - Net Premium Paid

LONG STRANGLE Vs LONG GUTS - When & How to use ?

	LONG STRANGLE	LONG GUTS
Market View	Neutral	Neutral
When to use?	This strategy is used in special scenarios where you foresee a lot of volatility in the market due to election results, budget, policy change, annual result announcements etc.	This strategy is implemented by a trader when he is neutral on the movements and bullish on volatility i.e. he expects the stock to move in either direction with high magnitude.
Action	Buy OTM Call Option, Buy OTM Put Option	Buy 1 ITM Call, Buy 1 ITM Put
Breakeven Point	Lower Breakeven Point = Strike Price of Put - Net Premium, Upper Breakeven Point = Strike Price of Call + Net Premium	Upper Breakeven Point = Net Premium Paid + Strike Price of Long Call, Lower Breakeven Point = Strike Price of Long Put - Net Premium Paid

LONG STRANGLE Vs LONG GUTS - Risk & Reward

	LONG STRANGLE	LONG GUTS
Maximum Profit Scenario	Profit = Price of Underlying - Strike Price of Long Call - Net Premium Paid	Price of Underlying - Strike Price of Long Call - Net Premium Paid OR Strike Price of Long Put - Price of Underlying - Premium Paid
Maximum Loss Scenario	Max Loss = Net Premium Paid	Net Premium Paid + Strike Price of Long Put - Strike Price of Long Call + Commissions Paid
Risk	Limited	Limited
Reward	Unlimited	Unlimited

LONG STRANGLE Vs LONG GUTS - Strategy Pros & Cons

	LONG STRANGLE	LONG GUTS
Similar Strategies	Long Straddle, Short Strangle	Short Put Ladder, Strip, Strap
Disadvantage	• Require significant price movement to book profit. • Traders can lose more money if the underlying asset stayed stagnant.	• More commission involved than simply buying call or put option. • Expensive.
Advantages	• Able to book profit, no matter if the underlying asset goes in either direction. • Limited loss to the debit paid. • If the underlying asset continues to move in one direction then you can book Unlimited profit .	• Investors can get unlimited profit if the underlying asset goes up or down. • Ability to profit no matter if the market goes in either direction. • Limited loss.