OPTION COMBINATIONS
Long Straddle
BUY CALL, BUY PUT
123 FIFTH AVENUE, NY 10160
Simultaneously buying a call option and a put option with the same strike price and expiration date
Short Straddle
SELL CALL, SELL PUT
123 FIFTH AVENUE, NY 10160
Simultaneously selling a call option and a put option with the same strike price and expiration date
Long Strangle
BUY CALL, BUY PUT
123 FIFTH AVENUE, NY 10160
Simultaneously buying an out-of-the-money call option and an out-of-the-money put option with different strike prices but the same expiration date
Short Strangle
SELL CALL, SELL PUT
123 FIFTH AVENUE, NY 10160
Simultaneously selling an out-of-the-money call option and an out-of-the-money put option with different strike prices but the same expiration date
Iron Condor
BUY CALL PUT, SELL CALL PUT
123 FIFTH AVENUE, NY 10160
Combining a bear call spread and a bull put spread to generate premium income while limiting potential losses
Iron Butterfly
BUY CALL PUT, SELL CALL PUT
123 FIFTH AVENUE, NY 10160
Combining a bear call spread and a bull put spread with the same strike prices to achieve a limited-risk, limited-reward position
Calendar Spread
BUY CALL SELL CALL or BUY PUT SELL PUT
123 FIFTH AVENUE, NY 10160
Simultaneously buying and selling options with different expiration dates but the same strike price
Butterfly Spread
BUY CALL PUT, SELL CALL PUT
123 FIFTH AVENUE, NY 10160
Combining a bull spread and a bear spread to achieve a limited-risk, limited-reward position
Ratio Spread
BUY CALL PUT, SELL CALL PUT
123 FIFTH AVENUE, NY 10160
Buying a greater number of options than selling to take advantage of potential price movements
Collar
BUY CALL PUT, SELL CALL PUT
123 FIFTH AVENUE, NY 10160
Combining a covered call and a protective put to limit potential losses and protect gains
Synthetic Long Stock
BUY CALL SELL PUT
123 FIFTH AVENUE, NY 10160
Combining a long call option and a short put option with the same strike price to mimic the characteristics of owning the underlying stock
Synthetic Short Stock
BUY PUT, SELL CALL
123 FIFTH AVENUE, NY 10160
Combining a short call option and a long put option with the same strike price to mimic the characteristics of a short stock position
Diagonal Spread
BUY CALL PUT, SELL CALL PUT
123 FIFTH AVENUE, NY 10160
Simultaneously buying and selling options with different strike prices and expiration dates
Bull Spread
BUY CALL SELL CALL
123 FIFTH AVENUE, NY 10160
Buying a call option with a lower strike price and simultaneously selling a call option with a higher strike price
Bear Spread
BUY PUT, SELL PUT
123 FIFTH AVENUE, NY 10160
Buying a put option with a higher strike price and simultaneously selling a put option with a lower strike price
Long Call Butterfly
BUY CALL PUT, SELL CALL PUT
123 FIFTH AVENUE, NY 10160
Combining a long call spread and a long put spread to create a limited-risk, limited-reward position
Long Put Butterfly
BUY CALL PUT, SELL CALL PUT
123 FIFTH AVENUE, NY 10160
Combining a long put spread and a long call spread to create a limited-risk, limited-reward position
Long Call Condor
BUY CALL PUT, SELL CALL PUT
123 FIFTH AVENUE, NY 10160
Combining a long call spread and a long put spread with different strike prices to create a limited-risk, limited-reward position
Long Put Condor
BUY CALL PUT, SELL CALL PUT
123 FIFTH AVENUE, NY 10160
Combining a long put spread and a long call spread with different strike prices to create a limited-risk, limited-reward position
Double Diagonal Spread
BUY CALL PUT, SELL CALL PUT
123 FIFTH AVENUE, NY 10160
Combining a diagonal call spread and a diagonal put spread to create a limited-risk, limited-reward position
Strap
BUY CALL PUT, SELL CALL PUT
123 FIFTH AVENUE, NY 10160
Buying two call options and one put option with the same strike price and expiration date to profit from a significant move in the underlying asset
Strip
BUY CALL PUT, SELL CALL PUT
123 FIFTH AVENUE, NY 10160
Buying two put options and one call option with the same strike price and expiration date to profit from a significant move in the underlying asset
Christmas Tree Spread
BUY CALL PUT, SELL CALL PUT
123 FIFTH AVENUE, NY 10160
Combining multiple call options and put options to create a complex risk-reward profile
Guts
BUY CALL PUT, SELL CALL PUT
123 FIFTH AVENUE, NY 10160
Buying an out-of-the-money call option and an out-of-the-money put option simultaneously to profit from significant price movement in either direction
Risk Reversal
BUY CALL PUT, SELL CALL PUT
123 FIFTH AVENUE, NY 10160
Combining a long call option and a short put option (or vice versa) to create a position that benefits from a rise in the underlying asset’s price while providing some downside protection
Box Spread
BUY CALL PUT, SELL CALL PUT
123 FIFTH AVENUE, NY 10160
Combining a bull call spread and a bear put spread to create a position with a guaranteed payoff at expiration
Iron Albatross
BUY CALL PUT, SELL CALL PUT
123 FIFTH AVENUE, NY 10160
Combining a bear call spread and a bull put spread with additional long options at higher strike prices