Learn Options Strategy: Long Straddle & Short Straddle

We can acknowledge that while Gamma is highest at the ATM strike price, near expiry, its impact on delta changes becomes more pronounced due to the shrinking time window. This can indeed lead to faster price movements for options, especially for short straddle sellers facing unexpected price swings.
On Short Straddle Expiry:
We can say that due to low theta (time decay) and potentially increased volatility, short straddles might not be as effective as theoretically expected close to expiry.

Short Straddle is more professional options strategy compare to long straddle, though this involved unlimited risk and huge up front margin.
Mechanics:
Short 1 lot ATM call options 
Short 1 lot ATM put options of the same underlying and expiry.
Timing:
No event is awaiting before the expiry.
Technical Analysis Scenario:
Underlying price trading near around the middle of its demand and supply, trend is week. So that the net premium received is almost equals to the breakeven distance from current market price in any side.
For example, assume Nifty trading at 24500, supply available around 24800 and demand available around 24250. 
24500CE trading at 120, where 24500PE trading at 130, now if we sell both the options, we will receive a premium of 250/-
See the upside breakeven point is 300 point above the CMP and downside breakeven point is 250 point below the CMP and we have already received a premium of 250/- 
This is better technical situation for short straddle.
Upper Side Breakeven Point = ATM Strike Price + Net Premium Received
Lower Side Breakeven Point = ATM Strike Price - Net Premium Received

Maximum Profit = Premium Received 
Maximum profit will occur if the underlying price close at ATM strike on expiry.

Maximum Loss = Unlimited
Either side significant movement will cause huge losses. We need to care this point, if we see sudden increase in volatility either we can cut our position at a loss or we can adjust our position to minimize losses. This adjustment depends on market or underlying conditions. Where demand supply analysis play a crucial roll.

Best Time For Short Straddle:
Already I mentioned earlier that near to the expiry short straddle is risky. Early in the expiry, when the time value is highest and at the same time price trading near around the middle of the demand an supply is the best timing. 
We shall remember, if we carry the position till the expiry it will be more risky. We shall check carefully the position, when we will see time value already reduced significantly and price still sideways, it is always better to book profit and close the strategy.

Example:
Assume Nifty trading at 24550
Sold 1 lot Nifty 24550CE  at 120
Sold 1 lot Nifty 24550PE at 130
--------------------------------------------------
Net premium received =250/-

Upper side Breakeven = 24550+250
                                        = 24800
For every 1 point up in Nifty above 24800 we will lose 1 Rupee for each point.

Downside breakeven point = 24550-250
                                                 = 24300
For every 1 point decline in Nifty below 24300, we will lose 1 Rupee for each point.

If Nifty Expire at 24550 we will keep the premium of 250 what we received for writing the options.
We will be in a safe position if Nifty trade anywhere in between 24300-24800

My views of timing may be contradictory with Short Straddle theory, but the fact is, in stock market practical is more important than theory. My 21 years experience is saying whatever I have discussed here are more valuable than normal theory.