Market View
Range Bound, Not moving
Implementation:
Sell ATM Put and ATM Call option.
- Sell 1 ATM Put option (Leg 1)
- Sell 1 ATM Call option (Leg 2)
Key trigger points:
- Net Credit = Call Premium + Put Premium
- Lower Breakeven = ATM - Net Credit
- Upper Breakeven = ATM + Net Credit
- Max Profit = Net Credit (at ATM)
- Max Loss = Unlimited (on either side)