How Does a Trader Determine the ‘Break-Even Points’ for a Long Straddle?

A Long Straddle involves buying both a Call and a Put with the same strike price and expiration date. The break-even points are calculated by taking the common strike price and adding the total premium paid for the Call and the Put for the upper break-even point.

For the lower break-even point, the total premium paid is subtracted from the strike price. The asset's price must move beyond these two points at expiration for the trade to be profitable.