An options strategy involving buying both a call and a put at the same strike price and expiration. Profits from a large move in either direction. Maximum loss is the total premium paid.
Before an FDA drug announcement, a trader bought a $50 straddle for $4 total. The stock jumped to $58, and the call alone was worth $8 — a $4 profit.
518 trading terms, 311 lessons, and AI-powered signals — all free to start.
Download Free