Summary: We can sell a Put against a short stock position, which will enhance our basis but will also weaken the [Delta](https://www.tastytrade.com/tt/learn/delta) exposure. Selling a [Strangle](https://www.tastytrade.com/tt/learn/strangle) against short stock will allow us to keep our delta exposure while collecting a larger credit. Still, is there an optimal environment to short a Strangle when coupled with long stock? tastytrade's Research Team ran a study to uncover the answer. ### Study * 2005 - 2016, SPY * 45 DTE * Simulated 30 Delta Covered Strangles * Sold 100 Shares of Stock * Sold 30 Delta Call * Sold 30 Delta Put * Managed at 50 % ### Results * If we look at every trade, this strategy was a net loss, due to bullish market * If we filter for higher IV environment, this strategy was a winning strategy due to higher credit * Extremely low IV also produced profitable results, likely due to selling short at market tops.
