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This is a topic that frustrates the heck out of me. How can you tell if an option is liquid enough to trade? Consider this: most volume occurs "at-the-money". If you correctly pick an option that moves "in-to-the-money", now volume is lower because it's not "at-the-money" anymore, so you wind up...

I'm new to doing straddles and I'm following Larry McMillan's method but I'm running into problems. If you are not familiar with Larry's method, basically he compiles information on various straddles and runs a monte carlo simulator to determine which straddles have the best probablility of ever...

Let's say you want to make a straddle. The delta of your call is .75 and costs $2.00 and the delta of your put is -.25 and costs .50 cents. To set up your straddle, you need only by one call and one put for a total of $2.50, but you wind up with a bias position of .5 delta (long 50 shares if you...