strangle


strangle
A trading strategy using options that is designed to profit from material increases in the volatility of the underlying. Similar to a straddle but using only put and call options with strike prices that are out of the money. American Banker Glossary
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buying or selling an out-of-the-money put option and call option on the same underlying instrument, with the same expiration. profits are made only if there is a drastic change in the underlying instrument's price. Bloomberg Financial Dictionary
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The purchase of a put and a call, in which the options have the same expiration and the put strike is lower than the call strike, called a long strangle. Also the sale of a put and a call, in which the options have the same expiration and the put strike is lower than the call strike, called a short strangle. Chicago Mercantile Exchange Glossary
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A type of option combination, similar to a straddle, where a call option and a put option on the same underlying asset with the same expiry date but different strike prices are either purchased (long strangle) or sold (short strangle). Strangles are generally entered into when a trader has a view on volatility, either that it will increase (long strangle) or decrease (short strangle). Long strangles have limited risk and unlimited rewards, whereas short strangles have limited reward and unlimited risks. When compared to straddles, strangles premiums are generally lower and have their breakevens further apart, i.e. a greater market movement will be required to make a long strangle profitable/short straddle unprofitable. Dresdner Kleinwort Wasserstein financial glossary
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An option strategy involving one call and one put with different strike levels but with the same expiry date. LIFFE

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strangle stran‧gle [ˈstræŋgl] noun [countable] FINANCE
another name for straddle:

• The strangle would be profitable if the stock price moves out of the 372p-444p range before expiry of the options on Nov 19.

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   An option strategy involving one call and one put with different strike levels but with the same expiry date. The strategy produces a profit if prices break above or below a given range, effectively a bet on volatility.

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strangle UK US /ˈstræŋɡl/ noun [C] FINANCE, STOCK MARKET
STRADDLE(Cf. ↑straddle)

Financial and business terms. 2012.

Synonyms:

Look at other dictionaries:

  • Strangle — Stran gle, v. t. [imp. & p. p. {Strangled}; p. pr. & vb. n. {Strangling}.] [OF. estrangler, F. [ e]trangler, L. strangulare, Gr. ?, ?, fr. ? a halter; and perhaps akin to E. string, n. Cf. {Strain}, {String}.] 1. To compress the windpipe of (a… …   The Collaborative International Dictionary of English

  • Strangle — Stran gle, v. i. To be strangled, or suffocated. [1913 Webster] …   The Collaborative International Dictionary of English

  • strangle — I verb arrest, block, check, choke off, crush, extinguish, hush, inhibit, keep back, keep down, mask, muzzle, put a stop to, quell, quiet, repress, reserve, restrain, silence, smother, snuff out, squelch, still, stop, strangulare, subdue,… …   Law dictionary

  • strangle — (v.) c.1300, from O.Fr. estrangler, from L. strangulare to choke, stifle, check, constrain, from Gk. strangalan choke, twist, from strangale a halter, cord, lace, related to strangos twisted, from PIE root *strenk tight, narrow; pull tight, twist …   Etymology dictionary

  • strangle — vb *suffocate, asphyxiate, stifle, smother, choke, throttle …   New Dictionary of Synonyms

  • strangle — [v] choke, stifle asphyxiate, gag, garrote/garrotte, inhibit, kill, muffle, quelch, repress, restrain, shush, smother, squelch, strangulate, subdue, suffocate, suppress, throttle; concepts 130,191,252 Ant. free, let go, loose …   New thesaurus

  • strangle — ► VERB 1) squeeze or constrict the neck of, especially so as to cause death. 2) suppress or hinder (an impulse, action, or sound). DERIVATIVES strangler noun. ORIGIN Old French estrangler, from Greek strangal halter …   English terms dictionary

  • strangle — [straŋ′gəl] vt. strangled, strangling [ME stranglen < OFr estrangler < L strangulare < Gr strangalan < strangalē, halter < strangos, twisted: see STRONG] 1. to kill by squeezing the throat as with the hands, a noose, etc., so as to …   English World dictionary

  • strangle — 01. The murdered woman had been [strangled] with a belt. 02. The dog almost [strangled] itself when it got its leash tangled on the fence. 03. I dreamt that someone was trying to [strangle] me, and when I woke up, I found my blanket had gotten… …   Grammatical examples in English

  • strangle — [[t]stræ̱ŋg(ə)l[/t]] strangles, strangling, strangled 1) VERB To strangle someone means to kill them by squeezing their throat tightly so that they cannot breathe. [V n] He tried to strangle a border policeman and steal his gun... [V n] He was… …   English dictionary