FTS Strangle Strategy

FTS (Fortis Inc.), in the Utilities sector, (Regulated Electric industry), listed on NYSE.

Fortis Inc. operates as an electric and gas utility company in Canada, the United States, and the Caribbean countries. It generates, transmits, and distributes electricity to approximately 438,000 retail customers in southeastern Arizona; and 100,000 retail customers in Arizona's Mohave and Santa Cruz counties with an aggregate capacity of 3,485 megawatts (MW), including 53 MW of solar capacity and 252 MV of wind capacity. The company also sells wholesale electricity to other entities in the western United States; owns gas-fired and hydroelectric generating capacity totaling 65 MW; and distributes natural gas to approximately 1,065,000 residential, commercial, and industrial customers in British Columbia, Canada. In addition, it owns and operates the electricity distribution system that serves approximately 577,000 customers in southern and central Alberta; owns 4 hydroelectric generating facilities with a combined capacity of 225 MW; and provides operation, maintenance, and management services to five hydroelectric generating facilities. Further, the company distributes electricity in the island portion of Newfoundland and Labrador with an installed generating capacity of 143 MW; and on Prince Edward Island with a generating capacity of 130 MW. Additionally, it provides integrated electric utility service to approximately 68,000 customers in Ontario; approximately 272,000 customers in Newfoundland and Labrador; approximately 32,000 customers on Grand Cayman, Cayman Islands; and approximately 16,000 customers on certain islands in Turks and Caicos.

FTS (Fortis Inc.) trades in the Utilities sector, specifically Regulated Electric, with a market capitalization of approximately $28.52B, a trailing P/E of 21.73, a beta of 0.43 versus the broader market, a 52-week range of 46.46-58.78, average daily share volume of 763K, a public-listing history dating back to 2010, approximately 10K full-time employees. These structural characteristics shape how FTS stock options price implied volatility around earnings windows, capital events, and macro-driven sector rotations.

A beta of 0.43 indicates FTS has historically moved less than the broader market, dampening realized volatility and producing tighter expected-move bands per unit of dollar exposure. FTS pays a dividend, which adjusts put-call parity and shifts the ex-dividend pricing across the listed chain.

What is a strangle on FTS?

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 FTS snapshot

As of May 14, 2026, spot at $56.44, ATM IV 14.10%, IV rank 3.31%, expected move 4.04%. The strangle on FTS 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 35-day expiry.

Why this strangle structure on FTS specifically: FTS IV at 14.10% is on the cheap side of its 1-year range, which favors premium-buying structures like a FTS strangle, with a market-implied 1-standard-deviation move of approximately 4.04% (roughly $2.28 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 FTS expiries trade a higher absolute premium for lower per-day decay. Position sizing on FTS should anchor to the underlying notional of $56.44 per share and to the trader's directional view on FTS stock.

FTS strangle setup

The FTS 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 FTS near $56.44, the first option leg uses a $59.26 strike; additional legs (when the strategy has them) anchor to spot-relative offsets. Premiums come from the bid/ask midpoint on the listed FTS 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 FTS shares for the stock leg in covered calls and collars).

Action	Type	Strike / Basis	Premium (est)
Buy 1	Call	$59.26	N/A
Buy 1	Put	$53.62	N/A

FTS 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.

FTS strangle payoff curve

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

Strangles on FTS 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 FTS chain.

FTS thesis for this strangle

The market-implied 1-standard-deviation range for FTS extends from approximately $54.16 on the downside to $58.72 on the upside. A FTS 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 FTS IV rank near 3.31% 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 FTS at 14.10%. As a Utilities name, FTS options can move on sector-level news flow (peer earnings, regulatory updates, industry-specific macro data) in addition to FTS-specific events.

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

Frequently asked questions

What is a strangle on FTS?: A strangle on FTS is the strangle strategy applied to FTS (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 FTS stock trading near $56.44, the strikes shown on this page are snapped to the nearest listed FTS chain strike and the premiums come straight from the end-of-day bid/ask midpoint.
How are FTS 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 FTS strangle priced from the end-of-day chain at a 30-day expiry (ATM IV 14.10%), 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 FTS strangle?: The breakeven for the FTS 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 FTS market-implied 1-standard-deviation expected move is approximately 4.04%; if the move sits well outside the breakeven distance, the structure's risk-reward becomes correspondingly tighter.
When should you consider a strangle on FTS?: Strangles on FTS 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 FTS chain.
How does current FTS implied volatility affect this strangle?: FTS ATM IV is at 14.10% with IV rank near 3.31%, 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.