A Jade Lizard leaves a short put unprotected. A Reverse Jade Lizard leaves a short call unprotected. The names look like mirror images, but the worst losses are not symmetric: a stock has a floor of zero and no fixed ceiling.
What Are You Choosing Between?
Identify which large move would hurt before comparing the credits. The standard version tolerates a large rise when its credit covers the call spread width. The reverse can tolerate a large decline when its credit covers the put spread width, while a rally leaves unlimited loss potential.
The Main Differences
Swipe the table to compare all columns →
| Compare | Jade Lizard | Reverse Jade Lizard |
|---|---|---|
| Construction | An unprotected short put plus a narrow Bear Call Spread. | A narrow Bull Put Spread plus an unprotected short call. |
| Example entry | $390 net credit | $330 net credit |
| Maximum profit | $390 | $330 |
| Maximum loss | $9,110 | Unlimited |
| Breakeven price | $91.10 | $108.30 |
A Practical Example
The Jade example sells the $95 put and $105/$107.50 call spread. The reverse sells the $105 call and $92.50/$95 put spread. Each wing is $2.50 wide, but the credits differ because the option quotes differ. Neither position has protection on its uncovered side.
XYZ is at $100 when the option trades are entered. Premiums below are per share; each option contract covers 100 shares. Each column shows one complete position, not an equal-capital allocation. Prices are hypothetical and exclude commissions, taxes, dividends, financing costs and early-assignment cashflows.
| Position | Example legs |
|---|---|
| Jade Lizard | Sell 1 $95 put, 30 days, at $3 Sell 1 $105 call, 30 days, at $3 Buy 1 $107.50 call, 30 days, at $2.10 |
| Reverse Jade Lizard | Buy 1 $92.50 put, 30 days, at $2.70 Sell 1 $95 put, 30 days, at $3 Sell 1 $105 call, 30 days, at $3 |
Comparing the Expiration Payoffs
- Jade Lizard
- Reverse Jade Lizard
Swipe the table to compare all columns →
| XYZ price | Jade Lizard | Reverse Jade Lizard |
|---|---|---|
| $80 | −$1,110 | $80 |
| $95 | $390 | $330 |
| $100 | $390 | $330 |
| $105 | $390 | $330 |
| $120 | $140 | −$1,170 |
What to Watch For
“No risk on one side” refers to a qualifying matched expiration payoff before costs. It does not remove assignment, funding or execution risk. Selling the call naked in the reverse structure is materially different from having cash ready to buy shares after a put assignment.
Before expiration, time value and implied volatility can change a position’s market value. Short options also create exercise and assignment obligations. Review the full strategy guides for position management and settlement details.
Explore the Strategies
Try the examples: