Strap

(redirected from straps)
Also found in: Dictionary, Thesaurus, Medical, Idioms, Encyclopedia.

Strap

A relatively simple trading strategy that involves buying a set of options, two calls and one put, with the same strike price and expiration date on a stock. The strap is a more focused version of the straddle, and is popular due to its unlimited profit, limited risk nature. The maximum loss that a strap can incur occurs when the equity price on the expiration date of the options is the same as the price on the date the options were purchased. In this case, the loss is equal to the sum the three-option set was purchased for. However, with any deviation in the price either up or down, the strategy recovers at least some of the cost of purchasing the options. See: Strip, Straddle
Copyright © 2012, Campbell R. Harvey. All Rights Reserved.

Strap

A bullish investment strategy in which an investor holds two calls and one put on the same underlying asset with the same expiration date and strike price. An investor uses a strap when he/she believes that the price of the underlying will increase substantially. If it does, the investor stands to make a substantial profit by exercising the calls. On the other hand, if the underlying decreases in price, the investor will not suffer a substantial loss because the strike price of the put protects him/her. See also: Call backspread ratio.
Farlex Financial Dictionary. © 2012 Farlex, Inc. All Rights Reserved

strap

A combination option made up of two calls and one put. The buyer of a strap profits from large variations in the price of the underlying asset, especially if it moves upward.
Wall Street Words: An A to Z Guide to Investment Terms for Today's Investor by David L. Scott. Copyright © 2003 by Houghton Mifflin Company. Published by Houghton Mifflin Company. All rights reserved. All rights reserved.
References in periodicals archive ?
Also approached by Quake for design assistance, its moldmaker machined some new cavity inserts for the mold, modifying it for a narrow strap. According to GLS, the modified mold inserts were able to maximize the desired benefits from the original overmolding process onto the narrower strap of the TerraGrip.
Loose straps lend themselves to a cool skater look but tying them helps give the slimmer silhouette designers are moving towards.
The electronic version of MTMCTEA 98-55-21--available at www.tea.army.mil/dpe/pdf/helo.pdf -- has been updated to incorporate the use of polyester straps as a suitable tie-down material.
The superior leather ends are tough, secure, and durable, a must to protect your valuable instrument, and the strap as a whole is made of flexible and dependable nylon.
BECAUSE THE STRAPS ARE SO STRONG, THE BUSTLE RACK ENDS UP SETTING RIPPED LOOSE INSTEAD OF THE STRAP BREAKING.
The watch index and hands are luminous and, of course, comes with interchangeable nylon straps. It comes with a two-year guarantee.
"Common sense would tell you that the leather strap must offer some protection.
Riddell's Hitter and XForce shoulder pads for youth players include features such as closed-cell foam for added protection, removable body for maintenance and cleaning and cantilevered strap attaches to pad body with velcro.
Secure all the straps in one direction first, then the other, weaving them to copy the original pattern on the chair.
[ClickPress, Thu Sep 27 2018] Global Horizontal Strapping Machine: Market Overview Strapping machines are used to dispenses, seal and tighten straps while bundling or packing.
The Strapper applies three straps to pallets of green plastic trays that are supplied to one of the UK's leading supermarkets, and four straps to pallets of T H Clements branded boxes, which are supplied to wholesale markets.