Monsanto has been consolidating for a few weeks in a narrow range, and I am expecting for a large move after the earnings release on Wednesday. By purchasing this straddle a few days ahead of the earnings release, it gives you a few opportunities to profit. Between now and Wednesday, the straddle’s extrinsic value should increase as Implied Vol is driven up by traders wanting to take a position in the puts or the calls to participate in the earnings fall-out. As of Friday, the IV for this straddle was 29%. You could see a slight increase in the value of the straddle as the IV increases. To be profitable by April expiration, based on Friday’s share price of 79.76, you’d need to see the stock move either lower than 75.48 or higher than 84.04.