The long strangle, leg by leg, with two real trades
The hedg3 Team
A long strangle is a call and a put on one expiry, both bought, with the call above the stock and the put below it. Like a straddle it needs a large move in either direction, and it costs less because both options start out of the money.
Long strangle
DebitVolatility AgentThe numbers at expiry
- Max profit: Unlimited above $108.20; $9,180 if XYZ goes to $0.
- Max loss: $320 with XYZ between $95 and $105: both premiums.
- Breakevens: $91.80 and $108.20: each strike moved out by the $3.20 debit.
- Cost: $320 paid at the open, nothing held beyond it.
Why the max loss is $320
The $320 paid is the whole risk. Between $95 and $105 at expiry both options are out of the money and expire worthless, so the full $320 is lost across that range. Outside it one leg has value, and the loss shrinks dollar for dollar.
| Buy the 105 call | −$160 |
| Buy the 95 put | −$160 |
| Net debit | −$320 |
| The 105 call and 95 put expire | $0 |
| Paid at the open | −$320 |
| Max loss | −$320 |
Exercise at expiry
Between $95 and $105 both options expire. Above $105 the call is exercised: 100 XYZ bought at $105. Below $95 the put is exercised: 100 XYZ sold at $95. Selling the pair before expiry takes the value in cash.
Winner: MARA, Oct 7 to Oct 12
| Leg | Contract | Price |
|---|---|---|
| Buy | MARA 12 call | $0.285 |
| Buy | MARA 10 put | $0.315 |
- Opened
- Oct 7, 2026, 9:31 AM ET · MARA $10.80
- Net debit
- $0.60 · $60 paid
- Target
- Sell at $0.90 · +$30
- Stop
- $0.30
- Closed
- Oct 12, 2026, 3:21 PM ET · —
- How
- Trailing exit
MARA was at $10.80, between the 10 put and the 12 call, when the strangle was bought for $0.60. By Oct 12 the pair was worth $0.83, and the trailing exit sold it: +$23 on $60. The row does not carry MARA's price at the exit.
Loser: GOOG, Sep 24 to Oct 9
| Leg | Contract | Price |
|---|---|---|
| Buy | GOOG 350 call | $3.45 |
| Buy | GOOG 320 put | $2.44 |
- Opened
- Sep 24, 2026, 10:30 AM ET · GOOG $335.685
- Net debit
- $5.89 · $589 paid
- Target
- Sell at $8.83 · +$294
- Stop
- Held to expiry
- Closed
- Oct 9, 2026, at expiry · GOOG $347.86
- How
- Held to expiry, expired worthless
GOOG was at $335.685, between the 320 put and the 350 call, when the strangle was bought for $5.89. It finished at $347.86 on expiry day, inside the strikes, and both legs expired worthless: −$589, the whole debit.
Every trade, on the record
The two trades above are the Volatility Agent's most recent settled winner and loser. Every long strangle it closes, winners and losers, is on the public track record.
The full strategy page covers the Greeks and when it is used: long strangle. Related: long straddle.
