Explore Your Options by Tom Gentile
NONDIRECTIONAL TRADES: STRADDLING THE MOVES
When you’re making a decision on buying a call or put option, trying to pick direction can cause confusion, which delays your decision, and by the time you decide, the stock has already moved and you miss out on the trade. How would you like a strategy that allows you to place a trade that doesn’t care which way the stock moves, just so long as it moves?
A nondirectional trade has a slight disadvantage over a directional trade in that the cost of the trade will be higher than with the directional long option trade, but it does offer more of a directional advantage in terms of allowing the stock to make a move higher or lower, which gives it a chance to profit no matter which way it eventually goes...