Straddle vs Strangle & Calendar Spread Explained: Volatility Strategies | CFA® Program Level III

Straddle vs strangle and calendar spreads explained visually, plus one map to pick the best option strategy for high or low volatility. ▶ Free study guide for CFA® Program candidates: https://sharpeandclear.com/study-guide/ ▶ Previous lesson, option strategies:    • Option Strategies Explained: Covered Call,...   ▶ Start of the series, option Greeks:    • Option Greeks Explained Visually: Delta, G...   ▶ Full series:    • Options Explained Visually: Option Greeks,...   Key terms: • Straddle: a call and a put on the same stock, same strike, same expiry (long = buy both, short = sell both). • Strangle: an out-of-the-money put and an out-of-the-money call, same expiry (out of the money = worth nothing if it expired today). • Calendar spread: sell a near-expiry call and buy a far-expiry call, same strike. Chapters 0:00 Intro: what you’ll learn, and a puzzle 1:14 Long straddle explained 3:22 Long straddle vs short straddle 4:01 Implied vs realized volatility: what betting on volatility means 5:21 Long strangle explained 6:53 Straddle vs strangle: which is better? 7:15 Calendar spread explained 9:43 Which option strategy? The direction × volatility matrix 10:58 Worked example: a long straddle on earnings 11:53 Practice question 1 12:57 Practice question 2 13:56 Recap: the matrix, and the puzzle solved 14:27 The full options series For CFA® Program Level III candidates and finance students: max gain, max loss, breakevens and Greeks of every strategy, a worked example and 2 exam-style practice questions. Educational content only, not investment advice. Not affiliated with or endorsed by CFA Institute. CFA® and Chartered Financial Analyst® are trademarks owned by CFA Institute. #OptionStrategies #VolatilityTrading #Options