Strip(redirected from reagent strip)
Also found in: Dictionary, Thesaurus, Medical, Legal, Encyclopedia, Wikipedia.
A bearish investment strategy in which an investor holds two puts and one call on the same underlying asset with the same expiration date and strike price. An investor uses a strip when he/she believes that the price of the underlying will decrease substantially. If it does, the investor stands to make a substantial profit by exercising the puts. On the other hand, if the underlying increases in price, the investor will not suffer a substantial loss because the strike price of the call protects him/her. See also: Call backspread ratio, Strap.
A combination of two put options and a call option. The buyer of a strip profits from large variations in the price of the underlying asset, especially if it is moving downward.