The Short Straddle is an options strategy involving the simultaneous selling of a Call and a Put with the same strike.

The investor receives the premium from the sold options, and hopes that the stock price will end at the strike level (or not too far from it) on the expiry date.

The profit of a Short Straddle is limited to the premium received, whereas its loss is unlimited.
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Buy / Sell Quantity Call / Put / Stock Strike Days to Expiry Volatility, % Premium Debit / Credit  

Short Straddle P/L Chart


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