From a poster on 'optionsxpress.com' discussion board:
"The "Tarzan Loves Jane" or "TLJ" is an Optionetics label for a double diagonal ratio spread. The idea is that you have a trade that has an unlimited upside profit potential, an unlimited downside profit potential, and a profit zone between the two.
You'll need to play with this on a risk graph to get the idea. Generally, you will want to buy a number of longer term call options and a number of longer longer term put option. For example, let's say five of each. This essentially gives you a strangle.
The next step is to sell a fewer number of front month calls and puts. For example, assume you sell three calls and three puts.
The more rapid theta decay of the short front month options gives you a positive theta. Your trade earns money from the passage of time.
Your trade, when initialy put on, is delta neutral. This means that the money lost on the long put from an upside move is offset by the money gained on the call side, and vice versa.
Each month you sell new short, front month calls and puts. Your goal is to profit from theta decay; i.e., premium collection. The ratioed longs give you a profit if there is a big directional "pop" in the underlying's price.
Where people get in trouble with this trade is they fail to understand the role of implied volatilitiy. This is a vega sensitive trade. An increase in IV will push the risk graph higher and create additional profits. A drop in IV will see the risk graph fall, creating a loss in the trade no matter what happens.
If you miscalculate IV on a TLJ, a.k.a., double diagonal ratio spread, you're bound to lose money. If you open the spread in low IV conditions, it can be a nice, non-directional play. Just make sure you understand what you're playing with."
daddy's boy
Must have been a typo in the previous post.