straddles and strangles Message Board

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Strategies & Market Trends : straddles and strangles

Public Reply Prvt Reply Mark as Last Read File

Previous 10 Next 10 Previous Next

To: charlie mcgeehan who wrote (4)	8/20/2004 3:49:41 PM
From: CapitalistHogg™	Read Replies (1) of 10

I agree with you that the stock price is going to move drastically up or down and probably right around August 27. Even with legging in it looks like straddling or strangling would be very difficult given the high Implied Volatility/Historical Volatility ratio making the option very expensive. Even with an extreme move in stock price the volatility will most certainly crash making the option less expensive. I ran several scenarios' with my option position simulator and while you could make some money it was dependent on the IV staying above 70%. Good luck.

Report TOU Violation

Share This Post

Public Reply Prvt Reply Mark as Last Read File

Previous 10 Next 10 Previous Next