ARWR Bear Put Spread Strategy
ARWR (Arrowhead Pharmaceuticals, Inc.), in the Healthcare sector, (Biotechnology industry), listed on NASDAQ.
Arrowhead Pharmaceuticals, Inc., founded in 1989 and based in Pasadena, California, is a biopharmaceutical company dedicated to discovering and advancing innovative treatments for complex and challenging-to-treat diseases within the United States. The company's extensive therapeutic pipeline primarily leverages RNA interference (RNAi) technology. Among its advanced clinical programs are: ARO-AAT, a Phase II therapeutic targeting liver diseases associated with alpha-1 antitrypsin deficiency; ARO-APOC3, which is undergoing both Phase 2b and Phase 3 clinical evaluations for hypertriglyceridemia; ARO-ANG3, currently in Phase 2b development to reduce the production of angiopoietin-like protein 3; and ARO-HIF2, a Phase 1b candidate designed to treat clear cell renal cell carcinoma. Arrowhead also has several compounds in earlier clinical development, including ARO-HSD in Phase 1/2a for other liver diseases, ARO-ENaC in Phase 1/2a, aimed at decreasing the epithelial sodium channel alpha subunit in lung airways, and ARO-C3, also in Phase 1/2a, for complement-mediated diseases. Further expanding its diverse portfolio, the company is actively developing ARO-Lung2 for chronic obstructive pulmonary disorder (COPD), ARO-DUX4 for facioscapulohumeral muscular dystrophy, ARO-XDH for uncontrolled gout, and ARO-COV for COVID-19 and other pulmonary-borne pathogens. Beyond its core internal programs, Arrowhead is involved in the progression of JNJ-3989, a subcutaneously administered RNAi therapeutic for chronic hepatitis B virus infection; Olpasiran, intended to reduce apolipoprotein A production; and ARO-AMG1, which targets genetically validated cardiovascular pathways.
ARWR (Arrowhead Pharmaceuticals, Inc.) trades in the Healthcare sector, specifically Biotechnology, with a market capitalization of approximately $11.11B, a beta of 1.28 versus the broader market, a 52-week range of 14.3-84.549, average daily share volume of 2.0M, a public-listing history dating back to 1993, approximately 609 full-time employees. These structural characteristics shape how ARWR stock options price implied volatility around earnings windows, capital events, and macro-driven sector rotations.
A beta of 1.28 places ARWR roughly in line with broader market moves, so the strategy payoff and realized volatility track the index-equivalent baseline.
What is a bear put spread on ARWR?
A bear put spread buys an at-the-money put and sells an out-of-the-money put at a lower strike for defined risk and defined reward bounded by the strike width.
Current ARWR snapshot
As of June 30, 2026, spot at $82.74, ATM IV 57.60%, IV rank 25.22%, expected move 16.51%. The bear put spread on ARWR 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 17-day expiry.
Why this bear put spread structure on ARWR specifically: ARWR IV at 57.60% is on the cheap side of its 1-year range, which favors premium-buying structures like a ARWR bear put spread, with a market-implied 1-standard-deviation move of approximately 16.51% (roughly $13.66 on the underlying). The 17-day window matched to the front-month expiry keeps theta exposure bounded while still capturing the post-snapshot move; longer-dated ARWR expiries trade a higher absolute premium for lower per-day decay. Position sizing on ARWR should anchor to the underlying notional of $82.74 per share and to the trader's directional view on ARWR stock.
ARWR bear put spread setup
The ARWR bear put spread below is built from the end-of-day chain, with each option leg priced at the bid/ask midpoint of its listed strike. With ARWR near $82.74, the first option leg uses a $82.50 strike; additional legs (when the strategy has them) anchor to spot-relative offsets. Premiums come from the bid/ask midpoint on the listed ARWR chain at a 17-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 ARWR shares for the stock leg in covered calls and collars).
| Action | Type | Strike / Basis | Premium (est) |
|---|---|---|---|
| Buy 1 | Put | $82.50 | $4.08 |
| Sell 1 | Put | $77.50 | $2.33 |
ARWR bear put spread risk and reward
- Net Premium / Debit
- -$175.00
- Max Profit (per contract)
- $325.00
- Max Loss (per contract)
- -$175.00
- Breakeven(s)
- $80.75
- Risk / Reward Ratio
- 1.857
Max profit equals strike width minus net debit times 100; max loss equals net debit times 100. Breakeven is long-put strike minus net debit.
ARWR bear put spread payoff curve
Modeled P&L at expiration across a range of underlying prices for the bear put spread on ARWR. 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% | +$325.00 |
| $18.30 | -77.9% | +$325.00 |
| $36.60 | -55.8% | +$325.00 |
| $54.89 | -33.7% | +$325.00 |
| $73.18 | -11.6% | +$325.00 |
| $91.48 | +10.6% | -$175.00 |
| $109.77 | +32.7% | -$175.00 |
| $128.06 | +54.8% | -$175.00 |
| $146.36 | +76.9% | -$175.00 |
| $164.65 | +99.0% | -$175.00 |
When traders use bear put spread on ARWR
Bear put spreads on ARWR reduce the cost of a bearish ARWR stock position by selling a lower-strike put; suited to moderate-decline theses where price reaches but does not vastly exceed the short strike.
ARWR thesis for this bear put spread
The market-implied 1-standard-deviation range for ARWR extends from approximately $69.08 on the downside to $96.40 on the upside. A ARWR bear put spread caps both the risk and the reward of a bearish position; relative to an outright long put on ARWR, the spread reduces the cost basis but limits the maximum profit to the strike width minus net debit. Current ARWR IV rank near 25.22% 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 ARWR at 57.60%. As a Healthcare name, ARWR options can move on sector-level news flow (peer earnings, regulatory updates, industry-specific macro data) in addition to ARWR-specific events.
ARWR bear put spread positions are structurally moderately bearish; 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. ARWR positions also carry Healthcare sector concentration risk; news flow inside the sector (peer earnings, regulatory shifts, supply-chain headlines) can move ARWR alongside the broader basket even when ARWR-specific fundamentals are unchanged. Long-premium structures like a bear put spread on ARWR are particularly exposed to IV-crush risk through scheduled events (earnings, FDA decisions, central-bank meetings) where IV typically contracts post-event regardless of the directional outcome. Always rebuild the position from current ARWR chain quotes before placing a trade.
Frequently asked questions
- What is a bear put spread on ARWR?
- A bear put spread on ARWR is the bear put spread strategy applied to ARWR (stock). The strategy is structurally moderately bearish: A bear put spread buys an at-the-money put and sells an out-of-the-money put at a lower strike for defined risk and defined reward bounded by the strike width. With ARWR stock trading near $82.74, the strikes shown on this page are snapped to the nearest listed ARWR chain strike and the premiums come straight from the end-of-day bid/ask midpoint.
- How are ARWR bear put spread max profit and max loss calculated?
- Max profit equals strike width minus net debit times 100; max loss equals net debit times 100. Breakeven is long-put strike minus net debit. For the ARWR bear put spread priced from the end-of-day chain at a 30-day expiry (ATM IV 57.60%), the computed maximum profit is $325.00 per contract and the computed maximum loss is -$175.00 per contract. Live intraday quotes will differ as the chain moves through the trading session.
- What is the breakeven for a ARWR bear put spread?
- The breakeven for the ARWR bear put spread priced on this page is roughly $80.75 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 ARWR market-implied 1-standard-deviation expected move is approximately 16.51%; if the move sits well outside the breakeven distance, the structure's risk-reward becomes correspondingly tighter.
- When should you consider a bear put spread on ARWR?
- Bear put spreads on ARWR reduce the cost of a bearish ARWR stock position by selling a lower-strike put; suited to moderate-decline theses where price reaches but does not vastly exceed the short strike.
- How does current ARWR implied volatility affect this bear put spread?
- ARWR ATM IV is at 57.60% with IV rank near 25.22%, 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.