A short strangle is similar to the Short Straddle except the strike prices are further apart, which lowers the premium received but also increases the chance of a profitable trade.
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The short strangle position is created by shorting or selling an OTM call option and an OTM put option with the same expiration date. The credit premium that you earn by selling these 2 options is your maximum profit for this position.
Short strangle. A compound option that consists of a short call and a short put on the same currency, with the same expiration dates, but with different strike prices.
Short Strangle
Risk: high
Reward: limited
General Description
Entering a short strangle entails selling out-of-the-money calls and puts.
Returning to the long box-spread, we see that the leading diagonal is a long gut combination, and the other diagonal is a short strangle combination. Hence a long box-spread may be created as a coupling of a long gut with a short strangle.
the same expiration and the put strike is lower than the call strike, called a long strangle. Also the sale of a put and a call, in which the options have the same expiration and the put strike is lower than the call strike, call a short strangle.
 See also: Short, Strangle, Option, Options, Put
  
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