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Username: Fluffy

Rating:
Guru Stars

Asked to: Heng Kim

Date Created: 01 Oct 2015
Category 17
Tag Forex
Question What is a bear straddle?
Advice from Guru
Hello Fluffy,

A speculative options trading strategy that consists of purchasing a short position in both a call and a put that have the same strike price and expiration date. A bear straddle's profit potential is limited to the premiums the investor collects from the trade. This type of straddle is based on the slang term "bear," which is used to describe a pessimistic investor who attempts to profit from a price decline.

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