MAGX Bear Put Spread Strategy
MAGX (Roundhill Investments - Daily 2X Long Magnificent Seven ETF), in the Financial Services sector, (Asset Management - Leveraged industry), listed on CBOE.
The Roundhill Daily 2X Long Magnificent Seven ETF, or "the Fund," is engineered to achieve daily investment results that are twice (2X) the performance of the Roundhill Magnificent Seven ETF (the "Magnificent Seven ETF"), prior to accounting for fees and expenses. Critically, this objective is designed to be met only within a single trading day. As a result, the Fund presents a higher risk profile compared to non-leveraged alternatives, given its strategy to amplify daily market fluctuations. For holding periods extending beyond a single day, the Fund's overall returns will be determined by the cumulative effect of its daily compounded performance. It is highly probable that its performance over such extended intervals will diverge significantly from a straightforward two-fold return of the Magnificent Seven ETF's performance, even before factoring in expenses and charges.
MAGX (Roundhill Investments - Daily 2X Long Magnificent Seven ETF) trades in the Financial Services sector, specifically Asset Management - Leveraged, with a market capitalization of approximately $41.6M, a beta of 2.93 versus the broader market, a 52-week range of 38.72-63.47, average daily share volume of 117K, a public-listing history dating back to 2024. These structural characteristics shape how MAGX etf options price implied volatility around earnings windows, capital events, and macro-driven sector rotations.
A beta of 2.93 indicates MAGX has historically moved more than the broader market, amplifying both the directional payoff and the realized volatility relative to an index-equivalent position. MAGX pays a dividend, which adjusts put-call parity and shifts the ex-dividend pricing across the listed chain.
What is a bear put spread on MAGX?
A bear put spread buys an at-the-money put and sells an out-of-the-money put at a lower strike for defined risk and defined reward bounded by the strike width.
Current MAGX snapshot
As of June 30, 2026, spot at $51.36, ATM IV 49.30%, IV rank 21.82%, expected move 14.13%. The bear put spread on MAGX below is built from the same end-of-day chain, with strikes snapped to listed contracts and premiums pulled from the bid/ask midpoint at a 17-day expiry.
Why this bear put spread structure on MAGX specifically: MAGX IV at 49.30% is on the cheap side of its 1-year range, which favors premium-buying structures like a MAGX bear put spread, with a market-implied 1-standard-deviation move of approximately 14.13% (roughly $7.26 on the underlying). The 17-day window matched to the front-month expiry keeps theta exposure bounded while still capturing the post-snapshot move; longer-dated MAGX expiries trade a higher absolute premium for lower per-day decay. Position sizing on MAGX should anchor to the underlying notional of $51.36 per share and to the trader's directional view on MAGX etf.
MAGX bear put spread setup
The MAGX bear put spread below is built from the end-of-day chain, with each option leg priced at the bid/ask midpoint of its listed strike. With MAGX near $51.36, the first option leg uses a $51.00 strike; additional legs (when the strategy has them) anchor to spot-relative offsets. Premiums come from the bid/ask midpoint on the listed MAGX chain at a 17-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 MAGX shares for the stock leg in covered calls and collars).
| Action | Type | Strike / Basis | Premium (est) |
|---|---|---|---|
| Buy 1 | Put | $51.00 | $3.05 |
| Sell 1 | Put | $49.00 | $2.30 |
MAGX bear put spread risk and reward
- Net Premium / Debit
- -$75.00
- Max Profit (per contract)
- $125.00
- Max Loss (per contract)
- -$75.00
- Breakeven(s)
- $50.25
- Risk / Reward Ratio
- 1.667
Max profit equals strike width minus net debit times 100; max loss equals net debit times 100. Breakeven is long-put strike minus net debit.
MAGX bear put spread payoff curve
Modeled P&L at expiration across a range of underlying prices for the bear put spread on MAGX. 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.
| Underlying Price | % From Spot | P&L at Expiration |
|---|---|---|
| $0.01 | -100.0% | +$125.00 |
| $11.36 | -77.9% | +$125.00 |
| $22.72 | -55.8% | +$125.00 |
| $34.07 | -33.7% | +$125.00 |
| $45.43 | -11.5% | +$125.00 |
| $56.78 | +10.6% | -$75.00 |
| $68.14 | +32.7% | -$75.00 |
| $79.49 | +54.8% | -$75.00 |
| $90.85 | +76.9% | -$75.00 |
| $102.20 | +99.0% | -$75.00 |
When traders use bear put spread on MAGX
Bear put spreads on MAGX reduce the cost of a bearish MAGX etf position by selling a lower-strike put; suited to moderate-decline theses where price reaches but does not vastly exceed the short strike.
MAGX thesis for this bear put spread
The market-implied 1-standard-deviation range for MAGX extends from approximately $44.10 on the downside to $58.62 on the upside. A MAGX bear put spread caps both the risk and the reward of a bearish position; relative to an outright long put on MAGX, the spread reduces the cost basis but limits the maximum profit to the strike width minus net debit. Current MAGX IV rank near 21.82% 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 MAGX at 49.30%. As a Financial Services name, MAGX options can move on sector-level news flow (peer earnings, regulatory updates, industry-specific macro data) in addition to MAGX-specific events.
MAGX bear put spread positions are structurally moderately bearish; 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. MAGX positions also carry Financial Services sector concentration risk; news flow inside the sector (peer earnings, regulatory shifts, supply-chain headlines) can move MAGX alongside the broader basket even when MAGX-specific fundamentals are unchanged. Long-premium structures like a bear put spread on MAGX are particularly exposed to IV-crush risk through scheduled events (earnings, FDA decisions, central-bank meetings) where IV typically contracts post-event regardless of the directional outcome. Always rebuild the position from current MAGX chain quotes before placing a trade.
Frequently asked questions
- What is a bear put spread on MAGX?
- A bear put spread on MAGX is the bear put spread strategy applied to MAGX (etf). The strategy is structurally moderately bearish: A bear put spread buys an at-the-money put and sells an out-of-the-money put at a lower strike for defined risk and defined reward bounded by the strike width. With MAGX etf trading near $51.36, the strikes shown on this page are snapped to the nearest listed MAGX chain strike and the premiums come straight from the end-of-day bid/ask midpoint.
- How are MAGX bear put spread max profit and max loss calculated?
- Max profit equals strike width minus net debit times 100; max loss equals net debit times 100. Breakeven is long-put strike minus net debit. For the MAGX bear put spread priced from the end-of-day chain at a 30-day expiry (ATM IV 49.30%), the computed maximum profit is $125.00 per contract and the computed maximum loss is -$75.00 per contract. Live intraday quotes will differ as the chain moves through the trading session.
- What is the breakeven for a MAGX bear put spread?
- The breakeven for the MAGX bear put spread priced on this page is roughly $50.25 at expiration, derived from end-of-day chain premiums. Breakeven is the underlying price at which the strategy's P&L crosses zero ignoring transaction costs and assignment risk. The current MAGX market-implied 1-standard-deviation expected move is approximately 14.13%; if the move sits well outside the breakeven distance, the structure's risk-reward becomes correspondingly tighter.
- When should you consider a bear put spread on MAGX?
- Bear put spreads on MAGX reduce the cost of a bearish MAGX etf position by selling a lower-strike put; suited to moderate-decline theses where price reaches but does not vastly exceed the short strike.
- How does current MAGX implied volatility affect this bear put spread?
- MAGX ATM IV is at 49.30% with IV rank near 21.82%, 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.