๐๐๐Earnings Season is in full swing. A Strangle is an options strategy where you buy a Call and a Put Option on the same stock, with different strike prices but the same expiration date. You are betting the stock will move a lot, but you don't care which direction.
Call Option: You profit if the stock goes up.
Put Option: You profit if the stock goes down.
Strangle : You profit if the stock goes anywhere but sideways.
Here is the catch: Strangles cost money upfront to buy. If the stock's earnings barely move the needle, both your Call and Put Options could expire worthless.
So can Strangle make you money? Absolutely, only if the stock delivers fireworks. But if the stock barely splutters, you are out of luck.
Strangle is a great strategy for the bold and tactical trader. So yes it is thrilling but it is definitely not for the risk adverse investors like me.
@Tiger_comments @TigerStars @Tiger_SG @CaptainTiger @TigerClub
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