February 27, 2014

Advisors Option: Straddles & Strangles

58 minutes

Options 101: Straddles & Strangles

Straddle: Buy/sell a call and put on the same strike.

Long straddles. But be careful of high decay. Flip that around and you have a short straddle.

Strangles allow you to benefit from significant underlying with smaller premium outlay compares to straddles. High decay still exist. Flip that around and you have a short strangle.

Covered Straddles and Strangles.

Listener Mail: What do you want to know?

Question from Avid Gardener - I am looking for ways to use options to establish very low cost, or hopefully free, bullish positions on stocks and ETFs. Is this possible or are my expectations unrealistic? Any specific strategies you could recommend would be greatly appreciated.

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By The Options Insider Radio Network

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