MEMX Straddle Strategy
MEMX (Matthews Emerging Markets ex China Active ETF MEMX), in the Financial Services sector, (Asset Management - Global industry), listed on AMEX.
The fund's primary goal is typically met by dedicating at least 80% of its total assets (including any borrowed capital used for investment) to the common and preferred shares of businesses operating in emerging market countries, explicitly excluding China. While the portfolio may include holdings in companies from developed nations or China, a key constraint applies: at the moment of acquisition, the fund cannot buy shares in any company based in a developed country or China if its combined exposure to these regions already exceeds 20% of its assets.
MEMX (Matthews Emerging Markets ex China Active ETF MEMX) trades in the Financial Services sector, specifically Asset Management - Global, with a market capitalization of approximately $49.8M, a beta of 1.18 versus the broader market, a 52-week range of 32.5-51.52, average daily share volume of 3K, a public-listing history dating back to 2023. These structural characteristics shape how MEMX etf options price implied volatility around earnings windows, capital events, and macro-driven sector rotations.
A beta of 1.18 places MEMX roughly in line with broader market moves, so the strategy payoff and realized volatility track the index-equivalent baseline. MEMX pays a dividend, which adjusts put-call parity and shifts the ex-dividend pricing across the listed chain.
What is a straddle on MEMX?
A long straddle buys an ATM call and an ATM put at the same strike, profiting from a large move in either direction; max loss equals the combined debit when the underlying pins to the strike at expiration.
Current MEMX snapshot
As of June 29, 2026, spot at $39.87, ATM IV 220.00%, IV rank 97.17%, expected move 63.07%. The straddle on MEMX 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 81-day expiry.
Why this straddle structure on MEMX specifically: MEMX IV at 220.00% is rich versus its 1-year range, which makes a premium-buying MEMX straddle relatively expensive in absolute-cost terms, with a market-implied 1-standard-deviation move of approximately 63.07% (roughly $25.15 on the underlying). The 81-day window matched to the front-month expiry keeps theta exposure bounded while still capturing the post-snapshot move; longer-dated MEMX expiries trade a higher absolute premium for lower per-day decay. Position sizing on MEMX should anchor to the underlying notional of $39.87 per share and to the trader's directional view on MEMX etf.
MEMX straddle setup
The MEMX straddle below is built from the end-of-day chain, with each option leg priced at the bid/ask midpoint of its listed strike. With MEMX near $39.87, the first option leg uses a $40.00 strike; additional legs (when the strategy has them) anchor to spot-relative offsets. Premiums come from the bid/ask midpoint on the listed MEMX chain at a 81-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 MEMX shares for the stock leg in covered calls and collars).
| Action | Type | Strike / Basis | Premium (est) |
|---|---|---|---|
| Buy 1 | Call | $40.00 | $9.05 |
| Buy 1 | Put | $40.00 | $7.97 |
MEMX straddle risk and reward
- Net Premium / Debit
- -$1,702.00
- Max Profit (per contract)
- Unbounded
- Max Loss (per contract)
- -$1,694.47
- Breakeven(s)
- $22.98, $57.02
- Risk / Reward Ratio
- Unbounded
Upside max profit is unbounded; downside max profit is bounded at the strike minus the combined call plus put debit (reached at zero). Max loss equals the combined debit times 100 (reached when the underlying pins to the strike). Two breakevens at strike plus debit and strike minus debit.
MEMX straddle payoff curve
Modeled P&L at expiration across a range of underlying prices for the straddle on MEMX. 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% | +$2,297.00 |
| $8.82 | -77.9% | +$1,415.56 |
| $17.64 | -55.8% | +$534.13 |
| $26.45 | -33.7% | -$347.31 |
| $35.27 | -11.5% | -$1,228.75 |
| $44.08 | +10.6% | -$1,293.81 |
| $52.90 | +32.7% | -$412.38 |
| $61.71 | +54.8% | +$469.06 |
| $70.52 | +76.9% | +$1,350.50 |
| $79.34 | +99.0% | +$2,231.93 |
When traders use straddle on MEMX
Straddles on MEMX are pure-volatility plays that profit from large moves in either direction; traders typically buy MEMX straddles ahead of earnings, FDA decisions, or other catalysts where the realized move is expected to exceed the implied move priced into the chain.
MEMX thesis for this straddle
The market-implied 1-standard-deviation range for MEMX extends from approximately $14.72 on the downside to $65.02 on the upside. A MEMX long straddle is a pure-volatility play: it profits when the underlying moves far enough from the strike in either direction to overcome the combined call plus put debit, regardless of direction. Current MEMX IV rank near 97.17% sits in the upper third of its 1-year distribution, which historically reverts; this raises the bar for premium-buying structures and lowers it for premium-selling structures on MEMX at 220.00%. As a Financial Services name, MEMX options can move on sector-level news flow (peer earnings, regulatory updates, industry-specific macro data) in addition to MEMX-specific events.
MEMX straddle positions are structurally neutral / high-volatility (long premium); 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. MEMX positions also carry Financial Services sector concentration risk; news flow inside the sector (peer earnings, regulatory shifts, supply-chain headlines) can move MEMX alongside the broader basket even when MEMX-specific fundamentals are unchanged. Always rebuild the position from current MEMX chain quotes before placing a trade.
Frequently asked questions
- What is a straddle on MEMX?
- A straddle on MEMX is the straddle strategy applied to MEMX (etf). The strategy is structurally neutral / high-volatility (long premium): A long straddle buys an ATM call and an ATM put at the same strike, profiting from a large move in either direction; max loss equals the combined debit when the underlying pins to the strike at expiration. With MEMX etf trading near $39.87, the strikes shown on this page are snapped to the nearest listed MEMX chain strike and the premiums come straight from the end-of-day bid/ask midpoint.
- How are MEMX straddle max profit and max loss calculated?
- Upside max profit is unbounded; downside max profit is bounded at the strike minus the combined call plus put debit (reached at zero). Max loss equals the combined debit times 100 (reached when the underlying pins to the strike). Two breakevens at strike plus debit and strike minus debit. For the MEMX straddle priced from the end-of-day chain at a 30-day expiry (ATM IV 220.00%), the computed maximum profit is unbounded per contract and the computed maximum loss is -$1,694.47 per contract. Live intraday quotes will differ as the chain moves through the trading session.
- What is the breakeven for a MEMX straddle?
- The breakeven for the MEMX straddle priced on this page is roughly $22.98 and $57.02 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 MEMX market-implied 1-standard-deviation expected move is approximately 63.07%; if the move sits well outside the breakeven distance, the structure's risk-reward becomes correspondingly tighter.
- When should you consider a straddle on MEMX?
- Straddles on MEMX are pure-volatility plays that profit from large moves in either direction; traders typically buy MEMX straddles ahead of earnings, FDA decisions, or other catalysts where the realized move is expected to exceed the implied move priced into the chain.
- How does current MEMX implied volatility affect this straddle?
- MEMX ATM IV is at 220.00% with IV rank near 97.17%, which is elevated relative to its 1-year range. Premium-selling structures (covered call, cash-secured put, iron condor) generally look more attractive when IV rank is high; premium-buying structures (long call, long put, debit spreads) are more expensive in that regime.