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Long Straddle
A long straddle involves buying: a call and a put with the same strike and expiration. Market view The trader expects sufficiently large movement but may be uncertain about direction. Risk Maximum expiration loss is generally the total premium paid.
Why it matters to you
A long straddle needs enough movement and/or favorable volatility dynamics to overcome the cost of owning both options and the effect of time decay. Being right that something big will happen isn't enough if the options already priced an even bigger move.