Series 7 - General Securities Representative Exam
By definition, an investor buys a call when anticipating higher prices and buys a put when anticipating lower prices. So, when does an investor sell an at the money straddle?
An investor sells a straddle and collects the premium of the sold call and put. The investor wants the price of the underlying security to stay within a range between the strike price plus the amount of premium collected (for the upside of the range) and the strike price minus the amount of premiu