Strangle


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Related to Strangle: strangle strategy

Strangle

Buying or selling an out-of-the-money put option and call option on the same underlying instrument, with the same expiration. Profits are made only if there is a drastic change in the underlying instrument's price.

Strangle Strategy

An option strategy in which one buys two out-of-the-money options (usually one call and one put) on the same asset at different strike prices. One profits from a strangle position when there is a large price movement on the underlying asset, regardless of the direction. This is because one of the options will become in the money, so long as the price moves in one direction or the other. Loss only occurs if the price of the underlying asset remains largely the same.

Strangle.

A strangle is a hedging strategy in which you buy or sell a put and a call option on the same underlying instrument with the same expiration date but at different strike prices that are equally out-of-the-money.

That is, the strike price for a put is above the current market price of the stock, stock index, or other product, and the strike price for a call is below the market price.

If you buy a strangle, you hope for a large price move in one direction or another that would allow you to sell one of the contracts at a significant profit. If you sell a strangle, you hope there's no significant price move in either direction so that the contracts expire out-of-the-money and you keep the premium you received.

References in periodicals archive ?
The couple had just watched a film which depicted a husband trying to strangle his wife.
She was quite clear to them that the man had tried to strangle her.
Vets may lance absesses - always ask for advice if strangles is suspected.
The ERA can confirm that there has not been a case of strangles in the UAE Thoroughbred racing population for more than 10 years and there were no signs suggestive of strangles at any time in horses participating in the Dubai International Racing Carnival," the ERA statement said.
equi and its effect on various blood parameters and serum protein values in horses showing clinical signs of strangles at Lahore and Sargodha districts of Punjab, Pakistan.
Having done so, it turned out not to be strangles, which was a huge relief all round.
She will address the launch event, held at the Royal Society of Medicine in central London, and discuss her own experiences of dealing with strangles, organisers have said.
Strangles is a contagious disease characterised by swollen glands in the head, jaw and throat regions.
A spate of strangles cases has caused rising panic in North Wales this year - with Llandudno Riders Association cancelling its summer show in Glan Conwy tomorrow amid reports of a case nearby.
Caused by the bacterium Streptococcus equi, strangles has many unpleasant effects including abscessed lymph nodes of the head and neck, which can in severe cases restrict the airway, leading to the name 'strangles'.
Plas Uchaf owner David Rae stressed his yard was free of strangles but he said the club's decision to cancel was the "responsible way forward".
Although strangles is no longer a notifiable sickness, Marner has informed the Animal Health Trust, the Thoroughbred Breeders' Association and her neighbour Tregoning.