How are CTSH 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 CTSH straddle priced from the August 14, 2026 end-of-day chain at a 30-day expiry (ATM IV 42.00%), the computed maximum profit is unbounded per contract and the computed maximum loss is -$609.91 per contract. Live intraday quotes will differ as the chain moves through the trading session.

What is the breakeven for a CTSH straddle?

The breakeven for the CTSH straddle priced on this page is roughly $53.78 and $66.23 at expiration, derived from the August 14, 2026 end-of-day chain's premiums. Breakeven is the underlying price at which the strategy's P&L crosses zero ignoring transaction costs and assignment risk. The CTSH market-implied 1-standard-deviation expected move in the same options snapshot is approximately 12.04%; if the move sits well outside the breakeven distance, the structure's risk-reward becomes correspondingly tighter.

How does current CTSH implied volatility affect this straddle?

CTSH ATM IV is at 42.00% with IV rank near 50.09%, 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.

CTSH Straddle Strategy

CTSH (Cognizant Technology Solutions Corporation), in the Technology sector, (Information Technology Services industry), listed on NASDAQ.

Cognizant Technology Solutions Corporation functions as a global professional services firm, delivering a comprehensive suite of consulting, technology, and outsourcing solutions across North America, Europe, and other international markets. Its operations are structured into four primary divisions: Financial Services, Healthcare, Products and Resources, and Communications, Media and Technology. Within the Financial Services sector, Cognizant provides advanced services such as enhancing customer experiences, implementing robotic process automation (RPA), and leveraging analytics and artificial intelligence (AI) to address needs in areas like digital lending, fraud prevention, and modern payment systems. For its Healthcare clients, the company focuses on navigating industry shifts toward consumer-centric models, outcome-based agreements, and digital health initiatives, striving to deliver an integrated, seamless, and patient-focused omnichannel experience. Furthermore, Cognizant assists in optimizing operations across various functions, including clinical development, pharmacovigilance, manufacturing, claims management, enrollment procedures, membership administration, and billing processes. Its clientele in this domain spans healthcare providers, payers, and life sciences organizations, encompassing pharmaceutical, biotechnology, and medical device firms.

CTSH (Cognizant Technology Solutions Corporation) trades in the Technology sector, specifically Information Technology Services, with a market capitalization of approximately $26.22B, a trailing P/E of 12.22, a beta of 0.81 versus the broader market, a 52-week range of 37.08-87.03, average daily share volume of 9.6M, a public-listing history dating back to 1998, approximately 357K full-time employees. These structural characteristics shape how CTSH stock options price implied volatility around earnings windows, capital events, and macro-driven sector rotations.

A beta of 0.81 places CTSH roughly in line with broader market moves, so the strategy payoff and realized volatility track the index-equivalent baseline. CTSH pays a dividend, which adjusts put-call parity and shifts the ex-dividend pricing across the listed chain.

What is a straddle on CTSH?

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.

CTSH snapshot

As of August 14, 2026, spot at $58.98, ATM IV 42.00%, IV rank 50.09%, expected move 12.04%. The straddle on CTSH below is built from the August 14, 2026 end-of-day chain, with strikes snapped to listed contracts and premiums pulled from the bid/ask midpoint at a 35-day expiry.

Why this straddle structure on CTSH specifically: CTSH IV at 42.00% 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 12.04% (roughly $7.10 on the underlying). The 35-day window matched to the front-month expiry keeps theta exposure bounded while still capturing the post-snapshot move; longer-dated CTSH expiries trade a higher absolute premium for lower per-day decay. Position sizing on CTSH should anchor to the underlying notional of $58.98 per share and to the trader's directional view on CTSH stock.

CTSH straddle setup

The CTSH straddle below is built from the August 14, 2026 end-of-day chain, with each option leg priced at the bid/ask midpoint of its listed strike. With CTSH at $58.98 on that close, the first option leg uses a $60.00 strike; additional legs (when the strategy has them) anchor to spot-relative offsets. Premiums come from the bid/ask midpoint on the listed CTSH chain at a 35-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 CTSH shares for the stock leg in covered calls and collars).

Action	Type	Strike / Basis	Premium (est)
Buy 1	Call	$60.00	$2.53
Buy 1	Put	$60.00	$3.70

CTSH straddle risk and reward

Net Premium / Debit: -$622.50
Max Profit (per contract): Unbounded
Max Loss (per contract): -$609.91
Breakeven(s): $53.78, $66.23
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.

CTSH straddle payoff curve

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

P&L at expiration across the modeled underlying-price range. Green shading marks profitable regions, red shading marks loss regions. Dotted purple verticals mark breakevens; the solid dark vertical marks current spot.

Underlying Price	% From Spot	P&L at Expiration
$0.01	-100.0%	+$5,376.50
$13.05	-77.9%	+$4,072.53
$26.09	-55.8%	+$2,768.56
$39.13	-33.7%	+$1,464.59
$52.17	-11.5%	+$160.62
$65.21	+10.6%	-$101.65
$78.25	+32.7%	+$1,202.32
$91.29	+54.8%	+$2,506.29
$104.33	+76.9%	+$3,810.26
$117.37	+99.0%	+$5,114.23

When traders use straddle on CTSH

Straddles on CTSH are pure-volatility plays that profit from large moves in either direction; traders typically buy CTSH straddles ahead of earnings, FDA decisions, or other catalysts where the realized move is expected to exceed the implied move priced into the chain.

CTSH thesis for this straddle

The market-implied 1-standard-deviation range for CTSH extends from approximately $51.88 on the downside to $66.08 on the upside. A CTSH 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 CTSH IV rank near 50.09% is mid-range against its 1-year distribution, so the IV signal is neutral; the straddle thesis on CTSH should anchor more to the directional view and the expected-move geometry. As a Technology name, CTSH options can move on sector-level news flow (peer earnings, regulatory updates, industry-specific macro data) in addition to CTSH-specific events.

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

Frequently asked questions

What is a straddle on CTSH?: A straddle on CTSH is the straddle strategy applied to CTSH (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 CTSH stock at $58.98 on the August 14, 2026 close, the strikes shown on this page are snapped to the nearest listed CTSH chain strike and the premiums come straight from that session's bid/ask midpoint.
How are CTSH 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 CTSH straddle priced from the August 14, 2026 end-of-day chain at a 30-day expiry (ATM IV 42.00%), the computed maximum profit is unbounded per contract and the computed maximum loss is -$609.91 per contract. Live intraday quotes will differ as the chain moves through the trading session.
What is the breakeven for a CTSH straddle?: The breakeven for the CTSH straddle priced on this page is roughly $53.78 and $66.23 at expiration, derived from the August 14, 2026 end-of-day chain's premiums. Breakeven is the underlying price at which the strategy's P&L crosses zero ignoring transaction costs and assignment risk. The CTSH market-implied 1-standard-deviation expected move in the same options snapshot is approximately 12.04%; if the move sits well outside the breakeven distance, the structure's risk-reward becomes correspondingly tighter.
When should you consider a straddle on CTSH?: Straddles on CTSH are pure-volatility plays that profit from large moves in either direction; traders typically buy CTSH 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 CTSH implied volatility affect this straddle?: CTSH ATM IV is at 42.00% with IV rank near 50.09%, 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.