ALXO Strangle Strategy

ALXO (ALX Oncology Holdings Inc.), in the Healthcare sector, (Biotechnology industry), listed on NASDAQ.

ALX Oncology Holdings Inc., a clinical-stage immuno-oncology company, focuses on developing therapies for patients fighting cancer. Its lead product candidate is ALX148, a CD47 blocking therapeutic that is in Phase 1b/2 clinical trial used for the treatment of myelodysplastic syndromes; and for the treatment of acute myeloid leukemia and non-Hodgkin's lymphoma, as well as a range of solid tumor indications, including head and neck squamous cell carcinoma, human epidermal growth factor receptor 2 (HER2) positive gastric/gastroesophageal junction carcinoma, HER2-expressing breast cancer, and other solid tumors. The company's pre-clinical products include ALTA-002, a SIRPa TRAAC that offers ways to engage the innate and adaptive immune response to cancer. ALX Oncology Holdings Inc. has a collaboration agreement with Merck for a Phase 2 trial evaluating ALX148 in combination with pembrolizumab with and without chemotherapy in patients with head and neck cancer; Zymeworks on a Phase 1 trial evaluating ALX148 with the HER2-targeting bispecific antibody zanidatamab in patients with HER2-expressing breast cancer and other solid tumors; and Tallac Therapeutics for the development, manufacturing and commercialization of a novel class of cancer immunotherapeutics. It also has a license agreement with Selexis SA and Crystal Bioscience, Inc. The company was founded in 2015 and is headquartered in South San Francisco, California.

ALXO (ALX Oncology Holdings Inc.) trades in the Healthcare sector, specifically Biotechnology, with a market capitalization of approximately $110.1M, a beta of 0.41 versus the broader market, a 52-week range of 0.404-2.66, average daily share volume of 928K, a public-listing history dating back to 2020, approximately 65 full-time employees. These structural characteristics shape how ALXO stock options price implied volatility around earnings windows, capital events, and macro-driven sector rotations.

A beta of 0.41 indicates ALXO has historically moved less than the broader market, dampening realized volatility and producing tighter expected-move bands per unit of dollar exposure.

What is a strangle on ALXO?

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 ALXO snapshot

As of May 15, 2026, spot at $2.04, ATM IV 199.90%, IV rank 38.36%, expected move 57.31%. The strangle on ALXO 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 34-day expiry.

Why this strangle structure on ALXO specifically: ALXO IV at 199.90% is mid-range versus its 1-year history, so strategy selection should anchor more to the directional thesis than to the IV regime, with a market-implied 1-standard-deviation move of approximately 57.31% (roughly $1.17 on the underlying). The 34-day window matched to the front-month expiry keeps theta exposure bounded while still capturing the post-snapshot move; longer-dated ALXO expiries trade a higher absolute premium for lower per-day decay. Position sizing on ALXO should anchor to the underlying notional of $2.04 per share and to the trader's directional view on ALXO stock.

ALXO strangle setup

The ALXO 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 ALXO near $2.04, the first option leg uses a $2.14 strike; additional legs (when the strategy has them) anchor to spot-relative offsets. Premiums come from the bid/ask midpoint on the listed ALXO chain at a 34-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 ALXO shares for the stock leg in covered calls and collars).

Action	Type	Strike / Basis	Premium (est)
Buy 1	Call	$2.14	N/A
Buy 1	Put	$1.94	N/A

ALXO strangle 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 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.

ALXO strangle payoff curve

Modeled P&L at expiration across a range of underlying prices for the strangle on ALXO. 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 strangle on ALXO

Strangles on ALXO 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 ALXO chain.

ALXO thesis for this strangle

The market-implied 1-standard-deviation range for ALXO extends from approximately $0.87 on the downside to $3.21 on the upside. A ALXO 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 ALXO IV rank near 38.36% is mid-range against its 1-year distribution, so the IV signal is neutral; the strangle thesis on ALXO should anchor more to the directional view and the expected-move geometry. As a Healthcare name, ALXO options can move on sector-level news flow (peer earnings, regulatory updates, industry-specific macro data) in addition to ALXO-specific events.

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

Frequently asked questions

What is a strangle on ALXO?: A strangle on ALXO is the strangle strategy applied to ALXO (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 ALXO stock trading near $2.04, the strikes shown on this page are snapped to the nearest listed ALXO chain strike and the premiums come straight from the end-of-day bid/ask midpoint.
How are ALXO 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 ALXO strangle priced from the end-of-day chain at a 30-day expiry (ATM IV 199.90%), 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 ALXO strangle?: The breakeven for the ALXO strangle 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 ALXO market-implied 1-standard-deviation expected move is approximately 57.31%; if the move sits well outside the breakeven distance, the structure's risk-reward becomes correspondingly tighter.
When should you consider a strangle on ALXO?: Strangles on ALXO 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 ALXO chain.
How does current ALXO implied volatility affect this strangle?: ALXO ATM IV is at 199.90% with IV rank near 38.36%, which is mid-range against its 1-year history. Strategy selection depends more on directional thesis and expected move than on a strong IV signal.