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The Straddle

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Okay, there are so many good jokes here but unfortunately our couth editor won't let us do them. So let's just get on with it. Sigh.

A straddle is a trade where the investor buys a call and a put at the same strike and with the same expiration dates.

Straddle example: Goose buys BUBB November $40 strike puts for $2; and also buys BUBB November $40 strike calls for $3. Straddles are all about framing—there is usually only so much up or down that these trades can go and they are usually e...

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