Strip

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Strip

Variant of a straddle. A strip is two puts and one call on a stock. A strap is two calls and one put on a stock. The puts and calls have the same strike price and expiration date. See: Strap.

Strip

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.

strip

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.
References in classic literature ?
With this loss of substance and exhaustion of strength, the homes of the people will be stripped bare, and three-tenths of their income will be dissipated; while government expenses for broken chariots, worn-out horses, breast-plates and helmets, bows and arrows, spears and shields, protective mantles, draught-oxen and heavy wagons, will amount to four-tenths of its total revenue.
It is true, they stripped him completely, one taking his horse, another his gun, a third his traps, a fourth his blanket, and so on, through all his accoutrements, and even his clothing, until he was stark naked; but then they generously made him a present of an old tattered buffalo robe, and dismissed him, with many complimentary speeches, and much laughter.
And this noisiness, this exultation at the moment of the ship's departure, make a tremendous contrast to the silent moments of her arrival in a foreign roadstead - the silent moments when, stripped of her sails, she forges ahead to her chosen berth, the loose canvas fluttering softly in the gear above the heads of the men standing still upon her decks, the master gazing intently forward from the break of the poop.
For all their vain struggles he flung them both from their chariot and stripped the armour from their bodies.
The exterior green bark being pulled off as worthless, there remains a slender fibrous substance, which is carefully stripped from the stick, to which it closely adheres.