Virginia Tech FIN FIN 3104 Your friend claims that a long straddle position is considered a speculation on the asset’s volatility, but isn’t sure why. Showing off your finance…
on the asset’s volatility, but isn’t sure why. Showing off your finance knowledge just a tad, you explain that the strategy _________ ( ” makes money” , “loses money” , “is flat” ) if underlying prices stay constant, but benefits from large __________ ( “up” , “down” , “either up or down” ) movements in underlying prices.
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