Risk Graphs: In The Money Short Strangle

7-10-2009 5-28-39 PM.pngitmshortstrangle

This strategy entails selling to open ITM short Calls and Puts  in the front month.  This is a premium collection strategy and to be successful, the stock must remain stagnant.  This is a credit trade and as such it has a limited reward and an unlimited risk on the upside as well as the downside.   Review the risk graph and it will reveal the risk and reward profile of this trade.  Best,  Robin

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