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Straddle

The Purchase or sale of an equal number of puts and Call, with the same strike price and Expiration date. A Straddle provides the opportunity to Profit from a prediction about the future Volatility of the Market. Long straddles are used to Profit from High volatility. Long straddles can be effective when an investor is confident that a stock price will change dramatically, but cannot predict the direction of the move. Short straddles represent the opposite prediction, that a stock price will not change.

Related Terms: 16 Call, Expiration date, High, Long, Long straddle, Market, Profit, Purchase, PPO, Put, Ratio, Short straddle, Straddle, Short, Unit, Volatility
Other Related Pages: Category: Options Starting With: S
Semi Related Terms: 784 CLICK HERE TO VIEW
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