to combine a call and put on the identical stock with the same expiration date and strike price. It is employed to take advantage of significant variability in stock price. High beta (a measure of volatility) stocks might be most suited for this. A significant price movement on one side will cover the cost of obtaining the options.
simultaneous purchase of a call option and a put option with the same exercise date and exercise price. This is an option position designed to profit from an expected increase in the price volatility of the underlying instrument.
position consisting of an equal number of put options and call options on the same underlying stock, stock index, or commodity future at the same exercise price and maturity date. Profits occur on volatile prices, no matter which direction.
strategy consisting of an equal number of put options and call options on the same underlying stock, stock index, or commodity future at the same strike price and maturity date. Each option may be exercised separately, although the combination of options is usually bought and sold as a unit.
