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eFinanceManagement.com
https://efinancemanagement.com/derivatives/straddle-vs-strangle
Straddle vs Strangle
1. Introduction
2. Differences
3. Reference
Content
Straddle and Strangle are both options strategies that help an investor make a profit. We also call both these strategies as
non-directional option strategies. This is because investors resort to such a strategy when they don’t have any view on the
direction that the price of the security would move.
Introduction
1. When to Use?
An investor usually goes for straddle when they have no idea on the direction that a price may move. On the other hand,
strangle is when an investor believes there are more chances of a price moving in one direction.
2. Cost:
Straddle trade usually cost more than strangle. Moreover, the investor requires less of price movement to break even in
case of strangle.
3. At-the Money / Out-of-the Money:
In a straddle, an investor goes for the call and puts option that is “at-the-money.” On the other hand, in strangle, an
investor goes for the call and put option that is “out-of-the-money.”
Differences
Reference
To know more about it, click on the link given below:
https://efinancemanagement.com/derivatives/straddle-vs-strangle

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Straddle vs Strangle

  • 3. Straddle and Strangle are both options strategies that help an investor make a profit. We also call both these strategies as non-directional option strategies. This is because investors resort to such a strategy when they don’t have any view on the direction that the price of the security would move. Introduction
  • 4. 1. When to Use? An investor usually goes for straddle when they have no idea on the direction that a price may move. On the other hand, strangle is when an investor believes there are more chances of a price moving in one direction. 2. Cost: Straddle trade usually cost more than strangle. Moreover, the investor requires less of price movement to break even in case of strangle. 3. At-the Money / Out-of-the Money: In a straddle, an investor goes for the call and puts option that is “at-the-money.” On the other hand, in strangle, an investor goes for the call and put option that is “out-of-the-money.” Differences
  • 5. Reference To know more about it, click on the link given below: https://efinancemanagement.com/derivatives/straddle-vs-strangle