Strangle is one of the favorite options trading strategies used by pro traders. A strangle is constructed when the trader holds both put and calls on the same stock or underlying asset in equal numbers with the same expiry but different strike prices. When the underlying stock moves in a well defined range, you can construct a strangle. Strangles have more risk but at the same time the return is also high. There are two types of strangles: Short Strangle and Long Strangle. Watch the video tutorials below that explain in detail how to construct a strangle. This video explains the Long Strangle Option Strategy!
Watch this video that explains Short Strangle Option Strategy!
Watch these videos also that show how trade a strangle on a small account!
http://www.youtube.com/watch?v=ZjbGvKlSzBo