"How to Trade a Long Straddle in Singapore ?"

"How to Trade a Long Straddle in Singapore ?"

When you expect a big move in a stock — but you’re not sure if the price will explode up or crash down — the Long Straddle is one of the most powerful and straightforward options trading strategies.

It removes the need to guess direction. You simply position yourself to profit from movement — in either direction.

This makes the Long Straddle a favourite among high-income Singapore investors during earnings, Fed announcements, CPI releases, or major news events.

What Exactly Is a Long Straddle?

A Long Straddle is built using:

1️⃣ A Long Call (profit if the stock goes up) 2️⃣ A Long Put (profit if the stock goes down)

Both options have:

• Same strike price

• Same expiration

• Same underlying stock

With this setup, you are betting on volatility, not direction.

Why This Strategy Works

The Long Straddle is a pure volatility strategy because:

✔ A big up move makes the call extremely profitable ✔ A big down move makes the put extremely profitable ✔ Only one side needs to win big ✔ Total risk is limited to the premium paid ✔ Profit potential is unlimited on the upside and large on the downside

This is why the Long Straddle appears in nearly every professional options trading system.

💵 Real ~$1,000 Example (AAPL)

Apple trades at $190.

You buy:

StepTradeOptionCost1Buy CallAAPL 190 Call$52Buy PutAAPL 190 Put$5Total Cost——$10 = $1,000 per straddle

Now let’s break down what needs to happen.

Break-Even Points

The stock must move far enough in either direction to cover the $10.00 total cost.

Break-even levels:

DirectionFormulaBreak-Even PriceUpsideStrike + Cost190 + 10 = $200DownsideStrike – Cost190 – 10 = $180

Any move past $200 or below $180 = profit.

The bigger the move → the bigger the profit.

📊 How the Straddle Performs

✔ Scenario 1 — Big Up Move (e.g., to $215)

• Put expires worthless

• Call becomes extremely valuable

Call intrinsic value = 215 – 190 = $25 Profit = $25 – $10 cost = $15 per share = $1,500 profit on a $1,000 trade

✔ Scenario 2 — Big Down Move (e.g., to $160)

• Call expires worthless

• Put becomes extremely valuable

Put intrinsic value = 190 – 160 = $30 Profit = $30 – $10 cost = $20 per share = $2,000 profit on a $1,000 trade

❌ Scenario 3 — Stock stays flat (e.g., $188–$192)

This is where the strategy loses.

You lose part (or all) of the $10 premium. This is why traders use straddles only during high-volatility catalysts.

Why High-Income Singapore Investors Use Straddles

✔ Perfect for earnings trades ✔ Works during major macro events ✔ No need to predict direction ✔ Limited risk, unlimited upside ✔ Fits perfectly into ~$1,000 trade sizing ✔ One of the most essential volatility strategies in the Best Options Trading Course in Singapore for Millionaires

This is one of the simplest, cleanest ways to trade volatility like a professional.

**Professional traders don’t predict direction.

They monetise movement.**

The Long Straddle allows any investor to do exactly that.