Strangle Stategy

This article is about the financial investment strategy. It is similar to Straddle.

In finance, a strangle is an investment strategy involving the purchase or sale of particular option derivatives that allows the holder to profit based on how much the price of the underlying security moves, regardless of the "direction" of price movement.

In Strangle, the trader is betting on the volatality. He is hopping the price to be too volatile. The trader will buy (long) a call with strike price above the current price and a Put with strike price below the current price .