Why are strangles often built with out-of-the-money options?

A long strangle usually buys a lower-strike put and a higher-strike call. If the current stock price sits between those strikes, both options are out of the money.

That setup lowers the initial premium compared with buying an otherwise similar at-the-money straddle. The tradeoff is that the stock must move farther before either option has intrinsic value at expiration.

For CFA questions, the rule is still leg by leg: the lower-strike put is out of the money when the stock is above that strike, and the higher-strike call is out of the money when the stock is below that strike.