What is the definition of a straddle in stock option?
- Posted on November 21, 2019
- Financial Terms
- By admin admin
Investingport understands a straddle in stock option as a way for an investor to take a wining and a losing position in a stock option at the same time. This means the investor buys a call and a put position in the same stock. As a result, investors reduced his or her risk.
A straddle is a neutral options strategy that involves simultaneously buying both a put option and a call option for the underlying security with the same strike price and the same expiration date.
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