Been trading long strangles on stocks to sell premium. Using lognormal distribution charts, standard deviation, ATR, and support/resistance levels to try to convince myself it is other than luck when a stock moves to point X. Are there any calculations that can be made that can enhance this strategy?
Stock at 34.13, long the Aug 37.50 puts, long the Aug 32.50 calls. Sell the 32.50 puts on a drop and sell the 37.50 calls on a run up.
You're not really "selling premium" by trading long strangles then - your just legging into up to two different spreads.
Thank you for the clarification, it was a misspeak when saying "selling premium", but you get the point. I have strangles on for the earnings period and the ones I picked were for volatility and premium. Some may have been better as short strangles or long straddles and I thought some discussion might be enlightening.