(redirected from strangler)
Also found in: Dictionary, Thesaurus, Medical, Legal, Idioms, Encyclopedia.
Related to strangler: frog strangler


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.


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 ?
When did The Stranglers realise that they had something special?
Through the series twists and turns, Stranglers probes: Was DeSalvo really the killer?
Police are considering the theory that the strangler drugged his victims before killing them.
The stranglers started out in 1974 and rode on the crest of New Wave, with the rise of the Punk era.
While in prison he told a fellow inmate that he was the Boston Strangler, and this was reported to the police.
Lorna was also shocked to learn that the strangler has been allowed out of prison on a training-for-freedom programme.
The strangler taunted police and even coined his own nickname BTK standing for 'bind, torture and kill'.
Racing against time, they piece together clues, interrogate witnesses and examine DNA evidence to stop the Brooklyn Strangler, who had just killed his sixth victim, from striking again.
THE annual UK tour by The Stranglers is upon us and they will be performing tracks from their extensive and acclaimed catalogue in Birmingham.