The term combination refers to an options strategy involving trades that take a position in both call and put options for the same underlying security. Option combinations allow investors to construct trades that balance risk and reward with their risk profile.
While the term combination can refer to any grouping of financial contracts, it's oftentimes used when referring to options. Specifically, an options combination can refer to a strategy that consists of the purchase and / or sale of both calls and puts for the same underlying security. Collars and straddles are two examples of combinations.