Straddle

Definition

Buying both a call and put at the same strike price and expiry.

Visual Reference

Example

Straddle is a core concept in derivatives pricing and hedging strategies.

In Practice

Also known as: Long Straddle, Volatility Play. Closely related to Options Strategy, Volatility.

Word Usage

Earnings plays; Volatility trading; Binary events

Use Case

Applied in Options & Derivatives contexts: Earnings plays; Volatility trading