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A straddle is a neutral strategy formed by selling a put and an call at the same strike price, typically at the money (ATM).

Because the strike prices of the short put and short call are the same in a straddle, one option will always be in the money (ITM) if the stock price is above or below the straddle strike price. If the stock is above the straddle strike price, the call will be in the money, and if the stock is below the straddle strike price, the put will be in the money.

Check out this blog article on straddles!

Watch this Market Measure on Selling Straddles

Watch this Market Measure comparing straddles and strangles



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