Bogota Free Planet Comments
Is A Big Move In Oil Prices Due?
Posted by BFP Staff on Jun 30, 2017 at 06:51 PM
How Much Further Could Oil Prices Fall?
By Brian Noble for Oilprice.com
In options trading, a straddle is literally a sit-on-the-fence strategy. By purchasing a put and a call at the same strike (price of underlying commodity) for the same time period, an investor isn’t making a conventional directional bet; rather the investor is looking for a big move either up or down. The rub is that the big move must be greater than the sum of the two option premia or the bet goes south. But that is in the nature of the trade.
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