y Darrell Martin
More than a year ago, Darrell Martin explained in detail how to straddle an Ags Report. (See A Trade To Remember For Your Calendar: Straddling The Ags Reports Using Nadex Spreads) Coming up on Thursday, April 9, 2015, at 12:00 noon ET, the WASDE report will be released. WASDE stands for the World Agricultural Supply and Demand Estimates Report. As Martin explained last year in his article, this report can cause massive moves in the Agricultural Markets, especially corn and soybeans. Expected massive market moves call for non-directional trading strategies such as straddles or strangles. If the Implied Volatility is high enough, an Iron Condor might be another strategy choice. Straddle or Strangle? Although the terms sound similar and are both used in non-directional trading, they are not synonymous. Straddles are done on spreads and Strangles are placed on binaries. Both involve two contracts placed on the same instrument expiring at the same time. With a straddle, it is like you are straddling a fence and you are right on top of it. Your two spread contracts must have the floor of the bought contract match the ceiling of the sold contract. It is opposite of an Iron Condor. To place a Binary Strangle trade, you sell the lower OTM (Out of The Money) contract and buy the upper OTM contract. It is the opposite of a Butterfly strategy. You are expecting one side to lose. You know the market is going to move. You just don’t know the direction. How to trade this News Event For the WASDE report, you can do either a straddle on Nadex Spreads or a strangle on Nadex Binary Options. Maximum risk on these strategies should never exceed $25 per side, with $15-20 being ideal. You will want to be in the trade before the news is released in order to get the best OTM strike prices. Live Binary Strangle Trade Watch this short video to see a live trade that brought in $300 in 15 minutes. Martin outlines the steps to help you better understand how to utilize the strangle strategy. If you would like to learn more about straddles and strangles, go to www.apexinvesting.com, a service of Darrell Martin.
Read more: http://www.benzinga.com/markets/bina…#ixzz3Wdl4qWst