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Short Straddle Risk Graph

Short Straddle - Components

 Sell a call option and a put option on the underlying stock, at the same strike price.

Sell ATM Call + Sell ATM Put



Short Straddle - Expectation

Neutral



Short Straddle - Risk / Reward

Maximum Profit: Limited

Maximum Loss: Unlimited



Short Straddle - Breakeven Point

Upper Break Even Point = Strike Price + Net Credit Recieved

Lower Break Even = Strike Price - Net Credit Recieved







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