Different options strategies like strangle and ratio

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Accepted Answer

Options strategies like strangle and ratio involve buying or selling multiple options to profit from market movements.

Strangle involves buying both a call and put option with different strike prices but the same expiration date.
Ratio involves buying or selling a different number of options to create a specific risk/reward profile.
Both strategies can be used to profit from volatility in the underlying asset.
Strangle can be used when expecting a significant price movement but unsure of the direction.
Ratio can be used to reduce the cost of entering a position or to increase potential profits.
Understanding the Greeks (delta, gamma, theta, vega) is important when trading these strategies.

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