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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 ?
Suspension strangulation, the second type, comprised approximately 70 percent of the strangulation cases studied.
A detailed enquiry/history of all the hanging cases and detailed external and internal examination of the body is essential to identify the antemortem hangings and also to differentiate between hanging and the ligature strangulation.
Reported lifetime participation in strangulation activities was 11% in the Ohio study and 6.
It is illegal to supply small children's garments with draw-through cords because of the risk of strangulation.
Morgan also sought additional jail time for Tena on the misdemeanor strangulation and menacing charges after Tena is released from prison.
The official cause of death was ligature strangulation.
The Danny Foundation was founded by a family whose child was injured by strangulation on a crib corner post.
The Consumer Products Safety Commission (CPSC) recently issued a warning about the strangulation hazard that may exist with some cribs that have projections on the cornerposts.
The professional tattoo artist was reportedly brought in on charges of felony domestic battery by strangulation.
All four suspects were charged with murder based on autopsy results showing that the 26-year-old victim sustained contusions and hematoma and died of asphyxia by manual strangulation.
Strangulation can happen even when children are in places where parents think they are safe, such as in a crib or in a bedroom.
INTRODUCTION: Groin hernia is a very common ailment among surgical patients and irreducibility, obstruction and strangulation are its commonest complications encountered in surgical practice as acute emergencies (1).