Consider a hypothetical example in which you sell both a put with a strike price of 90 yen and a call with a strike price of 110 yen for a premium of 2 yen each. You receive 4 yen in total. If the price at expiry is between 90 yen and 110 yen, the 4 yen is your profit, and the break-even points are 86 yen and 114 yen. Beyond the break-even points you make a loss, and the loss on the upside has no cap. If you buy both instead, the profit and loss is reversed, and the 4 yen paid is the maximum loss.
Strangle
- Japanese
- ストラングル
- Last reviewed
- September 25, 2026
This is a draft, shown for review before publication.
A strangle is a combination in which you buy both, or sell both, a call option (call) and a put option (put) with the same expiry but different strike prices. It is usually built from a put with a strike price below the current price and a call with a strike price above it, and the range between the two prices at which profit turns into loss is wider than for a straddle.