ALRS Straddle Strategy
ALRS (Alerus Financial Corporation), in the Financial Services sector, (Banks - Regional industry), listed on NASDAQ.
Alerus Financial Corporation, operating primarily through its subsidiary Alerus Financial, National Association, delivers a broad spectrum of financial services to both commercial clients and individual consumers. The company organizes its operations across four distinct segments: Banking, Retirement and Benefit Services, Wealth Management, and Mortgage. Within its Banking segment, Alerus provides a comprehensive array of deposit solutions, including checking, savings, money market, and certificate of deposit accounts. It also supports businesses with robust treasury management products like electronic receivables management, remote deposit capture, cash vault services, and other cash management tools. Lending solutions encompass various commercial loans, such as business term loans, lines of credit, commercial real estate financing, and construction and land development loans, alongside consumer offerings like residential first and second mortgages and installment loans. The Retirement and Benefit Services division focuses on administering retirement plans, providing investment advisory services, managing employee stock ownership plans (ESOPs), and offering payroll, health savings accounts (HSAs), and other employee benefits, including individual retirement accounts (IRAs).
ALRS (Alerus Financial Corporation) trades in the Financial Services sector, specifically Banks - Regional, with a market capitalization of approximately $774.5M, a trailing P/E of 28.89, a beta of 0.71 versus the broader market, a 52-week range of 20.26-30.95, average daily share volume of 179K, a public-listing history dating back to 2003, approximately 846 full-time employees. These structural characteristics shape how ALRS stock options price implied volatility around earnings windows, capital events, and macro-driven sector rotations.
A beta of 0.71 places ALRS roughly in line with broader market moves, so the strategy payoff and realized volatility track the index-equivalent baseline. ALRS pays a dividend, which adjusts put-call parity and shifts the ex-dividend pricing across the listed chain.
What is a straddle on ALRS?
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 ALRS snapshot
As of June 29, 2026, spot at $30.99, ATM IV 42.30%, IV rank 15.56%, expected move 12.13%. The straddle on ALRS 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 18-day expiry.
Why this straddle structure on ALRS specifically: ALRS IV at 42.30% is on the cheap side of its 1-year range, which favors premium-buying structures like a ALRS straddle, with a market-implied 1-standard-deviation move of approximately 12.13% (roughly $3.76 on the underlying). The 18-day window matched to the front-month expiry keeps theta exposure bounded while still capturing the post-snapshot move; longer-dated ALRS expiries trade a higher absolute premium for lower per-day decay. Position sizing on ALRS should anchor to the underlying notional of $30.99 per share and to the trader's directional view on ALRS stock.
ALRS straddle setup
The ALRS 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 ALRS near $30.99, the first option leg uses a $30.99 strike; additional legs (when the strategy has them) anchor to spot-relative offsets. Premiums come from the bid/ask midpoint on the listed ALRS chain at a 18-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 ALRS shares for the stock leg in covered calls and collars).
| Action | Type | Strike / Basis | Premium (est) |
|---|---|---|---|
| Buy 1 | Call | $30.99 | N/A |
| Buy 1 | Put | $30.99 | N/A |
ALRS 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.
ALRS straddle payoff curve
Modeled P&L at expiration across a range of underlying prices for the straddle on ALRS. 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 ALRS
Straddles on ALRS are pure-volatility plays that profit from large moves in either direction; traders typically buy ALRS straddles ahead of earnings, FDA decisions, or other catalysts where the realized move is expected to exceed the implied move priced into the chain.
ALRS thesis for this straddle
The market-implied 1-standard-deviation range for ALRS extends from approximately $27.23 on the downside to $34.75 on the upside. A ALRS 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 ALRS IV rank near 15.56% 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 ALRS at 42.30%. As a Financial Services name, ALRS options can move on sector-level news flow (peer earnings, regulatory updates, industry-specific macro data) in addition to ALRS-specific events.
ALRS 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. ALRS positions also carry Financial Services sector concentration risk; news flow inside the sector (peer earnings, regulatory shifts, supply-chain headlines) can move ALRS alongside the broader basket even when ALRS-specific fundamentals are unchanged. Always rebuild the position from current ALRS chain quotes before placing a trade.
Frequently asked questions
- What is a straddle on ALRS?
- A straddle on ALRS is the straddle strategy applied to ALRS (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 ALRS stock trading near $30.99, the strikes shown on this page are snapped to the nearest listed ALRS chain strike and the premiums come straight from the end-of-day bid/ask midpoint.
- How are ALRS 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 ALRS straddle priced from the end-of-day chain at a 30-day expiry (ATM IV 42.30%), 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 ALRS straddle?
- The breakeven for the ALRS straddle priced on this page is no defined breakeven on the modeled curve 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 ALRS market-implied 1-standard-deviation expected move is approximately 12.13%; if the move sits well outside the breakeven distance, the structure's risk-reward becomes correspondingly tighter.
- When should you consider a straddle on ALRS?
- Straddles on ALRS are pure-volatility plays that profit from large moves in either direction; traders typically buy ALRS 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 ALRS implied volatility affect this straddle?
- ALRS ATM IV is at 42.30% with IV rank near 15.56%, 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.