Warrants ... a Risk-Neutral trade is possible., page-6

Hi calisoti, why a straddle ... ???

Straddle: consists of buying both a CALL and a PUT simultaneously being AT THE MONEY with the same EXPIRY date.

Strangle: consists of buying both a CALL and a PUT simultaneously but at DIFFERENT STRIKE PRICES.

The above example (CBAWPN/CBAWOV) was a STRANGLE ... chosen because of the current offerings I have been trading, hold their VALUE better than others according to BSOPM modelling.

The numbers above are ACTUAL not theoretical ...

Cheers ...


This is only my view ... read the red stuff.