How are AGNC 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 AGNC strangle priced from the end-of-day chain at a 30-day expiry (ATM IV 20.94%), the computed maximum profit is unbounded per contract and the computed maximum loss is -$21.50 per contract. Live intraday quotes will differ as the chain moves through the trading session.

What is the breakeven for a AGNC strangle?

The breakeven for the AGNC strangle priced on this page is roughly $9.79 and $11.22 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 AGNC market-implied 1-standard-deviation expected move is approximately 6.00%; if the move sits well outside the breakeven distance, the structure's risk-reward becomes correspondingly tighter.

How does current AGNC implied volatility affect this strangle?

AGNC ATM IV is at 20.94% with IV rank near 21.57%, 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.

AGNC Strangle Strategy

AGNC (AGNC Investment Corp.), in the Real Estate sector, (REIT - Mortgage industry), listed on NASDAQ.

AGNC Investment Corp. operates as a real estate investment trust (REIT) in the United States. The company invests in residential mortgage pass-through securities and collateralized mortgage obligations for which the principal and interest payments are guaranteed by the United States government-sponsored enterprise or by the United States government agency. It funds its investments primarily through collateralized borrowings structured as repurchase agreements. The company has elected to be taxed as a REIT under the Internal Revenue Code of 1986 and would not be subject to federal corporate income taxes, if it distributes at least 90% of its taxable income to its stockholders. The company was formerly known as American Capital Agency Corp. and changed its name to AGNC Investment Corp. in September 2016. AGNC Investment Corp. was incorporated in 2008 and is headquartered in Bethesda, Maryland.

AGNC (AGNC Investment Corp.) trades in the Real Estate sector, specifically REIT - Mortgage, with a market capitalization of approximately $12.20B, a trailing P/E of 8.11, a beta of 1.34 versus the broader market, a 52-week range of 8.65-12.19, average daily share volume of 18.9M, a public-listing history dating back to 2008, approximately 53 full-time employees. These structural characteristics shape how AGNC stock options price implied volatility around earnings windows, capital events, and macro-driven sector rotations.

A beta of 1.34 indicates AGNC has historically moved more than the broader market, amplifying both the directional payoff and the realized volatility relative to an index-equivalent position. The trailing P/E of 8.11 is on the value side, where IV often compresses outside event windows because forward growth expectations are already discounted into the share price. AGNC pays a dividend, which adjusts put-call parity and shifts the ex-dividend pricing across the listed chain.

What is a strangle on AGNC?

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.

Current AGNC snapshot

As of May 15, 2026, spot at $10.38, ATM IV 20.94%, IV rank 21.57%, expected move 6.00%. The strangle on AGNC 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 28-day expiry.

Why this strangle structure on AGNC specifically: AGNC IV at 20.94% is on the cheap side of its 1-year range, which favors premium-buying structures like a AGNC strangle, with a market-implied 1-standard-deviation move of approximately 6.00% (roughly $0.62 on the underlying). The 28-day window matched to the front-month expiry keeps theta exposure bounded while still capturing the post-snapshot move; longer-dated AGNC expiries trade a higher absolute premium for lower per-day decay. Position sizing on AGNC should anchor to the underlying notional of $10.38 per share and to the trader's directional view on AGNC stock.

AGNC strangle setup

The AGNC strangle below is built from the end-of-day chain, with each option leg priced at the bid/ask midpoint of its listed strike. With AGNC near $10.38, the first option leg uses a $11.00 strike; additional legs (when the strategy has them) anchor to spot-relative offsets. Premiums come from the bid/ask midpoint on the listed AGNC chain at a 28-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 AGNC shares for the stock leg in covered calls and collars).

Action	Type	Strike / Basis	Premium (est)
Buy 1	Call	$11.00	$0.04
Buy 1	Put	$10.00	$0.18

AGNC strangle risk and reward

Net Premium / Debit: -$21.50
Max Profit (per contract): Unbounded
Max Loss (per contract): -$21.50
Breakeven(s): $9.79, $11.22
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.

AGNC strangle payoff curve

Modeled P&L at expiration across a range of underlying prices for the strangle on AGNC. 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	-99.9%	+$977.50
$2.30	-77.8%	+$748.10
$4.60	-55.7%	+$518.71
$6.89	-33.6%	+$289.31
$9.19	-11.5%	+$59.91
$11.48	+10.6%	+$26.48
$13.77	+32.7%	+$255.88
$16.07	+54.8%	+$485.28
$18.36	+76.9%	+$714.68
$20.66	+99.0%	+$944.07

When traders use strangle on AGNC

Strangles on AGNC 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 AGNC chain.

AGNC thesis for this strangle

The market-implied 1-standard-deviation range for AGNC extends from approximately $9.76 on the downside to $11.00 on the upside. A AGNC 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 AGNC IV rank near 21.57% 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 AGNC at 20.94%. As a Real Estate name, AGNC options can move on sector-level news flow (peer earnings, regulatory updates, industry-specific macro data) in addition to AGNC-specific events.

AGNC 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. AGNC positions also carry Real Estate sector concentration risk; news flow inside the sector (peer earnings, regulatory shifts, supply-chain headlines) can move AGNC alongside the broader basket even when AGNC-specific fundamentals are unchanged. Always rebuild the position from current AGNC chain quotes before placing a trade.

Frequently asked questions

What is a strangle on AGNC?: A strangle on AGNC is the strangle strategy applied to AGNC (stock). 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 AGNC stock trading near $10.38, the strikes shown on this page are snapped to the nearest listed AGNC chain strike and the premiums come straight from the end-of-day bid/ask midpoint.
How are AGNC 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 AGNC strangle priced from the end-of-day chain at a 30-day expiry (ATM IV 20.94%), the computed maximum profit is unbounded per contract and the computed maximum loss is -$21.50 per contract. Live intraday quotes will differ as the chain moves through the trading session.
What is the breakeven for a AGNC strangle?: The breakeven for the AGNC strangle priced on this page is roughly $9.79 and $11.22 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 AGNC market-implied 1-standard-deviation expected move is approximately 6.00%; if the move sits well outside the breakeven distance, the structure's risk-reward becomes correspondingly tighter.
When should you consider a strangle on AGNC?: Strangles on AGNC 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 AGNC chain.
How does current AGNC implied volatility affect this strangle?: AGNC ATM IV is at 20.94% with IV rank near 21.57%, 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.