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Net Premium paidStrike Price of OTM - Strike Price of ITM -
net DebitStrke Price of Long Put - Net Premium
19Strategy - 19 :- Long Call Butterfly
Neutral on Mkt direction and bearish on volatility
Sell 2 ATM call + Buy 1 ITM Call + buy 1 OTM
callNet Premium paid
Diff between 2 strikes - Net Premium
Upper Break Even = Strike Price(H) - Net Premium Lower Break Even = strike Price(L) + Net Premium
20Strategy - 20 :- Short Call Butterfly
Neutral on Mkt direction and bullish on volatility
Buy 2 ATM call + Sell 1 ITM Call + Sell 1 OTM
call
Diff between 2 strikes - Net Premium
Net Premium paid Upper Break Even = Strike Price(H) - Net Premium Lower Break Even = strike Price(L) + Net Premium
21Strategy - 21 :- Long Call Condor
Low volatility
Buy 1 ITM Call(LS) + Sell 1 ITM Call(LM) +
Sell 1 OTM Call(HM) + Buy 1 OTM Call(HS)
Limited Limited Upper Break Even = Strike Price(H) - Net Premium Lower Break Even = strike Price(L) + Net Premium
22Strategy - 22 :- Short Call Condor
Breakout expected but direction not sure
Sell 1 ITM Call(LS) + Buy 1 ITM Call(LM) +
Buy 1 OTM Call(HM) + Sell 1 OTM Call(HS)
Limited Limited Upper Break Even = Strike Price(H) - Net Premium Lower Break Even = strike Price(L) + Net Premium
Note :- LS = Lower Strike Price; HS = Higher Strike Price; LM = Lower Medium Strike Price & HM = Higher Medium Strike Price Buyer of call and seller of put benefits when market goes up. Profits of Buyer are unlimited whereas profits of seller are limited upto premium received. In adverse situation, buyer suffers losses upto max premium paid whereas seller suffers unlimited losses.