ADAM Straddle Strategy
ADAM (Adamas Trust, Inc.), in the Real Estate sector, (REIT - Mortgage industry), listed on NASDAQ.
Adamas Trust, Inc. is a U.S.-based entity primarily focused on the acquisition, investment, financing, and management of assets connected to single-family and multi-family residential mortgages. Its diverse portfolio includes targeted residential loans (which cover business purpose loans), agency and non-agency residential mortgage-backed securities (RMBS), structured multi-family property investments like preferred equity and mezzanine loans to property owners, and other assets related to mortgages, housing, and credit, along with strategic investments and commercial mortgage-backed securities (CMBS). Furthermore, the company extends its operations to owning and managing single-family rental properties. Qualifying as a Real Estate Investment Trust (REIT) for federal income tax purposes, Adamas Trust avoids federal corporate income taxes, provided it distributes a minimum of 90% of its taxable earnings to its stockholders. Established in 2003, the company's headquarters are located in New York, New York. It was formerly known as New York Mortgage Trust, Inc. until it officially changed its name to Adamas Trust, Inc. in September 2025.
ADAM (Adamas Trust, Inc.) trades in the Real Estate sector, specifically REIT - Mortgage, with a market capitalization of approximately $909.4M, a trailing P/E of 4.50, a beta of 1.25 versus the broader market, a 52-week range of 6.45-10.36, average daily share volume of 848K, a public-listing history dating back to 2025, approximately 221 full-time employees. These structural characteristics shape how ADAM stock options price implied volatility around earnings windows, capital events, and macro-driven sector rotations.
A beta of 1.25 places ADAM roughly in line with broader market moves, so the strategy payoff and realized volatility track the index-equivalent baseline. The trailing P/E of 4.50 is on the value side, where IV often compresses outside event windows because forward growth expectations are already discounted into the share price. ADAM pays a dividend, which adjusts put-call parity and shifts the ex-dividend pricing across the listed chain.
What is a straddle on ADAM?
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.
ADAM snapshot
As of August 14, 2026, spot at $10.12, ATM IV 16.10%, IV rank 2.97%, expected move 4.62%. The straddle on ADAM below is built from the 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 straddle structure on ADAM specifically: ADAM IV at 16.10% is on the cheap side of its 1-year range, which favors premium-buying structures like a ADAM straddle, with a market-implied 1-standard-deviation move of approximately 4.62% (roughly $0.47 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 ADAM expiries trade a higher absolute premium for lower per-day decay. Position sizing on ADAM should anchor to the underlying notional of $10.12 per share and to the trader's directional view on ADAM stock.
ADAM straddle setup
The ADAM 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 ADAM at $10.12 on that close, the first option leg uses a $10.12 strike; additional legs (when the strategy has them) anchor to spot-relative offsets. Premiums come from the bid/ask midpoint on the listed ADAM 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 ADAM shares for the stock leg in covered calls and collars).
| Action | Type | Strike / Basis | Premium (est) |
|---|---|---|---|
| Buy 1 | Call | $10.12 | N/A |
| Buy 1 | Put | $10.12 | N/A |
ADAM straddle risk and reward
- Net Premium / Debit
- N/A
- Max Profit (per contract)
- Unbounded
- Max Loss (per contract)
- Unbounded
- Breakeven(s)
- None on modeled curve
- Risk / Reward Ratio
- N/A
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.
ADAM straddle payoff curve
Modeled P&L at expiration across a range of underlying prices for the straddle on ADAM. 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.
When traders use straddle on ADAM
Straddles on ADAM are pure-volatility plays that profit from large moves in either direction; traders typically buy ADAM straddles ahead of earnings, FDA decisions, or other catalysts where the realized move is expected to exceed the implied move priced into the chain.
ADAM thesis for this straddle
The market-implied 1-standard-deviation range for ADAM extends from approximately $9.65 on the downside to $10.59 on the upside. A ADAM 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 ADAM IV rank near 2.97% 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 ADAM at 16.10%. As a Real Estate name, ADAM options can move on sector-level news flow (peer earnings, regulatory updates, industry-specific macro data) in addition to ADAM-specific events.
ADAM 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. ADAM positions also carry Real Estate sector concentration risk; news flow inside the sector (peer earnings, regulatory shifts, supply-chain headlines) can move ADAM alongside the broader basket even when ADAM-specific fundamentals are unchanged. Always rebuild the position from current ADAM chain quotes before placing a trade.
Frequently asked questions
- What is a straddle on ADAM?
- A straddle on ADAM is the straddle strategy applied to ADAM (stock). 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 ADAM stock at $10.12 on the most recent close, the strikes shown on this page are snapped to the nearest listed ADAM chain strike and the premiums come straight from that session's bid/ask midpoint.
- How are ADAM 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 ADAM straddle priced from the end-of-day chain at a 30-day expiry (ATM IV 16.10%), the computed maximum profit is unbounded per contract and the computed maximum loss is unbounded per contract. Live intraday quotes will differ as the chain moves through the trading session.
- What is the breakeven for a ADAM straddle?
- The breakeven for the ADAM straddle priced on this page is no defined breakeven on the modeled curve at expiration, derived from the 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 ADAM market-implied 1-standard-deviation expected move in the same options snapshot is approximately 4.62%; if the move sits well outside the breakeven distance, the structure's risk-reward becomes correspondingly tighter.
- When should you consider a straddle on ADAM?
- Straddles on ADAM are pure-volatility plays that profit from large moves in either direction; traders typically buy ADAM 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 ADAM implied volatility affect this straddle?
- ADAM ATM IV is at 16.10% with IV rank near 2.97%, 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.