AUR Straddle Strategy
AUR (Aurora Innovation, Inc.), in the Technology sector, (Information Technology Services industry), listed on NASDAQ.
Aurora Innovation, Inc. operates as a self-driving technology company in the United States. It focuses on developing Aurora Driver, a platform that brings a suite of self-driving hardware, software, and data services together to adapt and interoperate passenger vehicles, light commercial vehicles, and trucks. The company was founded in 2017 and is headquartered in Pittsburgh, Pennsylvania.
AUR (Aurora Innovation, Inc.) trades in the Technology sector, specifically Information Technology Services, with a market capitalization of approximately $16.46B, a beta of 2.59 versus the broader market, a 52-week range of 3.6-8.565, average daily share volume of 21.3M, a public-listing history dating back to 2021, approximately 2K full-time employees. These structural characteristics shape how AUR stock options price implied volatility around earnings windows, capital events, and macro-driven sector rotations.
A beta of 2.59 indicates AUR has historically moved more than the broader market, amplifying both the directional payoff and the realized volatility relative to an index-equivalent position.
What is a straddle on AUR?
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 AUR snapshot
As of May 15, 2026, spot at $7.78, ATM IV 78.81%, IV rank 40.53%, expected move 22.59%. The straddle on AUR 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 straddle structure on AUR specifically: AUR IV at 78.81% 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 22.59% (roughly $1.76 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 AUR expiries trade a higher absolute premium for lower per-day decay. Position sizing on AUR should anchor to the underlying notional of $7.78 per share and to the trader's directional view on AUR stock.
AUR straddle setup
The AUR 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 AUR near $7.78, the first option leg uses a $8.00 strike; additional legs (when the strategy has them) anchor to spot-relative offsets. Premiums come from the bid/ask midpoint on the listed AUR 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 AUR shares for the stock leg in covered calls and collars).
| Action | Type | Strike / Basis | Premium (est) |
|---|---|---|---|
| Buy 1 | Call | $8.00 | $0.58 |
| Buy 1 | Put | $8.00 | $0.80 |
AUR straddle risk and reward
- Net Premium / Debit
- -$137.50
- Max Profit (per contract)
- Unbounded
- Max Loss (per contract)
- -$135.54
- Breakeven(s)
- $6.63, $9.38
- Risk / Reward Ratio
- Unbounded
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.
AUR straddle payoff curve
Modeled P&L at expiration across a range of underlying prices for the straddle on AUR. 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% | +$661.50 |
| $1.73 | -77.8% | +$489.59 |
| $3.45 | -55.7% | +$317.68 |
| $5.17 | -33.6% | +$145.77 |
| $6.89 | -11.5% | -$26.14 |
| $8.61 | +10.6% | -$76.95 |
| $10.32 | +32.7% | +$94.96 |
| $12.04 | +54.8% | +$266.87 |
| $13.76 | +76.9% | +$438.78 |
| $15.48 | +99.0% | +$610.69 |
When traders use straddle on AUR
Straddles on AUR are pure-volatility plays that profit from large moves in either direction; traders typically buy AUR straddles ahead of earnings, FDA decisions, or other catalysts where the realized move is expected to exceed the implied move priced into the chain.
AUR thesis for this straddle
The market-implied 1-standard-deviation range for AUR extends from approximately $6.02 on the downside to $9.54 on the upside. A AUR 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 AUR IV rank near 40.53% is mid-range against its 1-year distribution, so the IV signal is neutral; the straddle thesis on AUR should anchor more to the directional view and the expected-move geometry. As a Technology name, AUR options can move on sector-level news flow (peer earnings, regulatory updates, industry-specific macro data) in addition to AUR-specific events.
AUR 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. AUR positions also carry Technology sector concentration risk; news flow inside the sector (peer earnings, regulatory shifts, supply-chain headlines) can move AUR alongside the broader basket even when AUR-specific fundamentals are unchanged. Always rebuild the position from current AUR chain quotes before placing a trade.
Frequently asked questions
- What is a straddle on AUR?
- A straddle on AUR is the straddle strategy applied to AUR (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 AUR stock trading near $7.78, the strikes shown on this page are snapped to the nearest listed AUR chain strike and the premiums come straight from the end-of-day bid/ask midpoint.
- How are AUR 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 AUR straddle priced from the end-of-day chain at a 30-day expiry (ATM IV 78.81%), the computed maximum profit is unbounded per contract and the computed maximum loss is -$135.54 per contract. Live intraday quotes will differ as the chain moves through the trading session.
- What is the breakeven for a AUR straddle?
- The breakeven for the AUR straddle priced on this page is roughly $6.63 and $9.38 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 AUR market-implied 1-standard-deviation expected move is approximately 22.59%; if the move sits well outside the breakeven distance, the structure's risk-reward becomes correspondingly tighter.
- When should you consider a straddle on AUR?
- Straddles on AUR are pure-volatility plays that profit from large moves in either direction; traders typically buy AUR 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 AUR implied volatility affect this straddle?
- AUR ATM IV is at 78.81% with IV rank near 40.53%, 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.