Market View
Range-bound, Not moving
Implementation:
Sell a Put below spot price(OTM) and sell a Call above the spot(OTM) price
- Sell 1 OTM Put option (Leg 1 - LS)
- Sell 1 OTM Call option (Leg 2 - HS )
Key trigger points:
- Net Credit = Call Premium + Put Premium
- Lower Breakeven = PE Strike - Net Credit
- Upper Breakeven = CE Stike + Net Credit
- Max Profit = Net Credit (Between LS and HS)
- Max Loss = Unlimited (on either side)