Strap

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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

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.

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.
References in periodicals archive ?
Louis Cardinals, Pedro Strop, Baltimore Orioles Relief Pitcher, Select Bethesda Big Train Players, Big Train Manager, Sal Colangelo
Before a case is submitted to STROP, a notice is sent to the parent giving advance warning of the enforcement action.
FEISTY Sharon Osbourne threw a strop at a swanky Hollywood bash - hurling a glass of water over a fellow guest.
dankszy: If you flounce in a strop from an office and there's nobody there to see or hear it, is it really a flounce in a strop?
Instead she threw a strop, posed briefly for a couple of pictures and then stormed off.
EVEN multi-millionaire, pampered sportsmen occasionally get in a strop.
She said: "Technical drawings for each project are supplied by the design team and each strop has to be made to a very strict standard.
But his latest strop tops the lot - apparently the Welsh star hates losing so much he can't bring himself to allow three-year-old son Cameron to beat him at computer football.
But in the end he did exactly the same as Franny and then throws a strop because the fans disapprove.
Joseph Koshansky and Pedro Strop each hit a solo home run, and then Florentino Nunez drilled a single to left.
EIGHTIES icon Boy George needs to karma, karma down after he reportedly had a strop in a Newport nightclub.
EMOTIONAL Cher arrives at secret gig where she had strop