In general, does a straddle mean a long position on a call and put? Or can one be a short position? Does the payoff given in the notes solution 2.9(chapter 2) correspond to a long call and long put?
Would the pay off be a straight line if either one is short? upward sloping or downward depending on whether it is a short put or call?
payoff of straddle is : if long: v shape if short (bottom vertical combination) : inverted v shape. the product you might be referring to is a range forward contract with common strike for both call(long) and put(short) : payoff of a long forward contract, or call(short) and put(long) : payoff of a short forward contract