blasher: I'm guessing David's straddle is bullish because the focal point is $5, but as you say, it requires big movement to make profits. If the stock goes to between $2.80 and $7.20 that just breaks even for his position.
$2.80 ---- $ 0
$5.00 ----($ 9,900)
$7.20 ---- $ 0
That's a pretty big outlay with the stock more than doubling on the long side without making any profit at all. The gamble is lowered because of the volatility: one might not be shocked that the stock doubles. The problem is you have a doubling stock, a supposedly bullish position, and no profit.
David, can you explain more about how you see this working out?
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