Assume that you purchase a 6-month COST $35 straddle for $6.00 with COST at $35. Two months later, COST is at $30 and you feel that COST could move back higher and you want to take advantage of the current large price drop in COST to reduce your cost and perhaps boost your profits somewhat. You still expect COST to continue to move from its current price; if COST does move back higher, you could lose time value and any unrealized gain in your put as COST slowly makes its way back higher. Assume that a $30 Call with the same expiration as your $35 Straddle is trading for $2.

You can purchase the $30 Call and create a modified strap which includes a $35 Put, a $35 Call, and a $30 Call for a total trade cost of $8 when the additional call premium is added in. The question is why would you add more premiums to your position? What do you expect to make? What is the difference between the straddle and the modified strap profit profiles?