How Does a “Straddle” Options Strategy Profit from Changes in Implied Volatility?

A long straddle strategy involves simultaneously buying a call option and a put option with the same strike price and expiration date. This strategy profits from a significant move in the underlying asset's price in either direction, or an increase in implied volatility.

An increase in implied volatility makes both the call and the put option premiums more expensive, increasing the value of the straddle position even if the underlying price has not yet moved significantly.