An option trading strategy (a standard strip) which is constructed by buying a number of call options (from three and eight) on the same underlying. In this strategy, the strike prices and expiration months need not be identical. However, both strikes and expiration months must be entered in an ascending order.
For example, a call strip may be constructed using three call options with the following strikes and expiration months: 1) $30, March 2, xxxx, 2) $32, April, xxxx and 3) $35, May, xxxx)
A call strip (also a call strip option) comes in two key forms: long call strip and short call strip.
Comments