How are CEPI strangle max profit and max loss calculated?

Upside max profit is unbounded; downside max profit is bounded at the put strike minus the combined debit (reached at zero). Max loss equals the combined debit times 100 (reached anywhere between the two OTM strikes). Two breakevens at call-strike plus debit and put-strike minus debit. For the CEPI strangle priced from the August 14, 2026 end-of-day chain at a 30-day expiry (ATM IV 30.40%), the computed maximum profit is unbounded per contract and the computed maximum loss is -$142.50 per contract. Live intraday quotes will differ as the chain moves through the trading session.

What is the breakeven for a CEPI strangle?

The breakeven for the CEPI strangle priced on this page is roughly $28.58 and $34.43 at expiration, derived from the August 14, 2026 end-of-day chain's premiums. Breakeven is the underlying price at which the strategy's P&L crosses zero ignoring transaction costs and assignment risk. The CEPI market-implied 1-standard-deviation expected move in the same options snapshot is approximately 8.72%; if the move sits well outside the breakeven distance, the structure's risk-reward becomes correspondingly tighter.

How does current CEPI implied volatility affect this strangle?

CEPI ATM IV is at 30.40% with IV rank near 23.01%, which is on the low end of its 1-year range. Premium-buying structures (long call, long put, debit spreads) are relatively cheap in this regime; premium-selling structures collect less credit per unit risk.

CEPI Strangle Strategy

CEPI (REX Crypto Equity Premium Income ETF), in the Financial Services sector, (Asset Management industry), listed on NASDAQ.

CEPI aims for exposure in US crypto-related companies, in sectors such as crypto mining, trading, custody, blockchain technology development, and the creation of digital payment solutions. Component securities are grouped into Crypto Assets Leaders and Digital Payments Leaders of this space, with a 80% and 20% allocation respectively. The fund holds 25 stock positions, while employing a covered call strategy, writing out-of-the-money options on individual securities to boost income from higher premiums, partially offsetting price declines and limiting upside potential. CEPI focuses on stock selection and option writing tailored to prevailing market conditions. The strategy aims to cushion against market declines and manage price volatility, blending capital appreciation and current income.

CEPI (REX Crypto Equity Premium Income ETF) trades in the Financial Services sector, specifically Asset Management, with a market capitalization of approximately $115.0M, a beta of 1.71 versus the broader market, a 52-week range of 26.981-43.7, average daily share volume of 44K, a public-listing history dating back to 2024. These structural characteristics shape how CEPI etf options price implied volatility around earnings windows, capital events, and macro-driven sector rotations.

A beta of 1.71 indicates CEPI has historically moved more than the broader market, amplifying both the directional payoff and the realized volatility relative to an index-equivalent position. CEPI pays a dividend, which adjusts put-call parity and shifts the ex-dividend pricing across the listed chain.

What is a strangle on CEPI?

A long strangle buys an OTM call and an OTM put at offset strikes, cheaper than a straddle but requiring a larger underlying move to profit since both wings start out-of-the-money.

CEPI snapshot

As of August 14, 2026, spot at $31.73, ATM IV 30.40%, IV rank 23.01%, expected move 8.72%. The strangle on CEPI below is built from the August 14, 2026 end-of-day chain, with strikes snapped to listed contracts and premiums pulled from the bid/ask midpoint at a 35-day expiry.

Why this strangle structure on CEPI specifically: CEPI IV at 30.40% is on the cheap side of its 1-year range, which favors premium-buying structures like a CEPI strangle, with a market-implied 1-standard-deviation move of approximately 8.72% (roughly $2.77 on the underlying). The 35-day window matched to the front-month expiry keeps theta exposure bounded while still capturing the post-snapshot move; longer-dated CEPI expiries trade a higher absolute premium for lower per-day decay. Position sizing on CEPI should anchor to the underlying notional of $31.73 per share and to the trader's directional view on CEPI etf.

CEPI strangle setup

The CEPI strangle below is built from the August 14, 2026 end-of-day chain, with each option leg priced at the bid/ask midpoint of its listed strike. With CEPI at $31.73 on that close, the first option leg uses a $33.00 strike; additional legs (when the strategy has them) anchor to spot-relative offsets. Premiums come from the bid/ask midpoint on the listed CEPI chain at a 35-day expiry; the cross-strike IV skew is reflected directly in the per-leg values rather than approximated. Quantity sizing assumes one contract per option leg (or 100 CEPI shares for the stock leg in covered calls and collars).

Action	Type	Strike / Basis	Premium (est)
Buy 1	Call	$33.00	$0.35
Buy 1	Put	$30.00	$1.08

CEPI strangle risk and reward

Net Premium / Debit: -$142.50
Max Profit (per contract): Unbounded
Max Loss (per contract): -$142.50
Breakeven(s): $28.58, $34.43
Risk / Reward Ratio: Unbounded

Upside max profit is unbounded; downside max profit is bounded at the put strike minus the combined debit (reached at zero). Max loss equals the combined debit times 100 (reached anywhere between the two OTM strikes). Two breakevens at call-strike plus debit and put-strike minus debit.

CEPI strangle payoff curve

Modeled P&L at expiration across a range of underlying prices for the strangle on CEPI. Each row is one sampled price point from the computed payoff curve; the full curve uses 200 price points internally before being summarized into 10 rows here.

P&L at expiration across the modeled underlying-price range. Green shading marks profitable regions, red shading marks loss regions. Dotted purple verticals mark breakevens; the solid dark vertical marks current spot.

Underlying Price	% From Spot	P&L at Expiration
$0.01	-100.0%	+$2,856.50
$7.02	-77.9%	+$2,155.04
$14.04	-55.8%	+$1,453.59
$21.05	-33.6%	+$752.13
$28.07	-11.5%	+$50.67
$35.08	+10.6%	+$65.79
$42.10	+32.7%	+$767.24
$49.11	+54.8%	+$1,468.70
$56.13	+76.9%	+$2,170.16
$63.14	+99.0%	+$2,871.62

When traders use strangle on CEPI

Strangles on CEPI are the cheaper cousin of the straddle - traders use them when they want a large directional move but are willing to give up the inner-strike sensitivity in exchange for a lower up-front debit on the CEPI chain.

CEPI thesis for this strangle

The market-implied 1-standard-deviation range for CEPI extends from approximately $28.96 on the downside to $34.50 on the upside. A CEPI long strangle is the OTM cousin of the straddle: lower up-front cost but the underlying has to travel further past either OTM strike before the position turns profitable at expiration. Current CEPI IV rank near 23.01% sits in the lower third of its 1-year distribution, where IV often re-expands toward the mean; this favors premium-buying structures and disadvantages premium-selling structures on CEPI at 30.40%. As a Financial Services name, CEPI options can move on sector-level news flow (peer earnings, regulatory updates, industry-specific macro data) in addition to CEPI-specific events.

CEPI strangle positions are structurally neutral / high-volatility (long premium, OTM); the modeled P&L assumes European-style exercise at expiration and ignores early assignment, transaction costs, dividends paid before expiry on the stock leg (when present), and the bid-ask spread on the listed chain. CEPI positions also carry Financial Services sector concentration risk; news flow inside the sector (peer earnings, regulatory shifts, supply-chain headlines) can move CEPI alongside the broader basket even when CEPI-specific fundamentals are unchanged. Always rebuild the position from current CEPI chain quotes before placing a trade.

Frequently asked questions

What is a strangle on CEPI?: A strangle on CEPI is the strangle strategy applied to CEPI (etf). The strategy is structurally neutral / high-volatility (long premium, OTM): A long strangle buys an OTM call and an OTM put at offset strikes, cheaper than a straddle but requiring a larger underlying move to profit since both wings start out-of-the-money. With CEPI etf at $31.73 on the August 14, 2026 close, the strikes shown on this page are snapped to the nearest listed CEPI chain strike and the premiums come straight from that session's bid/ask midpoint.
How are CEPI strangle max profit and max loss calculated?: Upside max profit is unbounded; downside max profit is bounded at the put strike minus the combined debit (reached at zero). Max loss equals the combined debit times 100 (reached anywhere between the two OTM strikes). Two breakevens at call-strike plus debit and put-strike minus debit. For the CEPI strangle priced from the August 14, 2026 end-of-day chain at a 30-day expiry (ATM IV 30.40%), the computed maximum profit is unbounded per contract and the computed maximum loss is -$142.50 per contract. Live intraday quotes will differ as the chain moves through the trading session.
What is the breakeven for a CEPI strangle?: The breakeven for the CEPI strangle priced on this page is roughly $28.58 and $34.43 at expiration, derived from the August 14, 2026 end-of-day chain's premiums. Breakeven is the underlying price at which the strategy's P&L crosses zero ignoring transaction costs and assignment risk. The CEPI market-implied 1-standard-deviation expected move in the same options snapshot is approximately 8.72%; if the move sits well outside the breakeven distance, the structure's risk-reward becomes correspondingly tighter.
When should you consider a strangle on CEPI?: Strangles on CEPI are the cheaper cousin of the straddle - traders use them when they want a large directional move but are willing to give up the inner-strike sensitivity in exchange for a lower up-front debit on the CEPI chain.
How does current CEPI implied volatility affect this strangle?: CEPI ATM IV is at 30.40% with IV rank near 23.01%, which is on the low end of its 1-year range. Premium-buying structures (long call, long put, debit spreads) are relatively cheap in this regime; premium-selling structures collect less credit per unit risk.