different strike prices, but with the same expiry. Position is generally taken at Out-of-the money strikes for both call and put. Here also the outlook is uncertain but volatile.
Long Strangle:
Buy One Out-of-the money Call & Buy One Out-of-the money Put.
Strangle is the extension of straddle position, which is taken in a more aggressive way. It is aggressive because both the options are out-of-the- money. Thus this strangle comes cheap, as premiums are low. However, no profit zone in this strategy is a little wider.
Short Strangle :Here one call and one put are sold at different strike prices, but with the same expiry. Positions are generally taken out-of-the- money strikes. Strangle seller assumes stability and that the price will remain in a particular zone.
