HCI Bull Call Spread Strategy
HCI (HCI Group, Inc.), in the Financial Services sector, (Insurance - Property & Casualty industry), listed on NYSE.
Headquartered in Tampa, Florida, HCI Group, Inc., originally established in 2006 as Homeowners Choice, Inc. before its name change in May 2013, is a diversified holding company. It conducts business across four main segments: property and casualty insurance, reinsurance, real estate, and information technology. Within Florida, the company underwrites residential insurance policies for homeowners, condominium owners, and tenants, offering coverage types such as homeowners, fire, flood, and wind-only, alongside reinsurance services. Its real estate portfolio encompasses ownership and management of waterfront properties, retail shopping centers, an office building, and various commercial investment properties. Additionally, HCI Group's technology division designs and builds web-based applications and mobile solutions, including its online policy administration platforms SAMS and Harmony, the end-to-end claims management system ClaimColony, and the mapping and data visualization tool AtlasViewer.
HCI (HCI Group, Inc.) trades in the Financial Services sector, specifically Insurance - Property & Casualty, with a market capitalization of approximately $2.30B, a trailing P/E of 6.80, a beta of 1.05 versus the broader market, a 52-week range of 136.37-210.5, average daily share volume of 197K, a public-listing history dating back to 2008, approximately 552 full-time employees. These structural characteristics shape how HCI stock options price implied volatility around earnings windows, capital events, and macro-driven sector rotations.
A beta of 1.05 places HCI roughly in line with broader market moves, so the strategy payoff and realized volatility track the index-equivalent baseline. The trailing P/E of 6.80 is on the value side, where IV often compresses outside event windows because forward growth expectations are already discounted into the share price. HCI pays a dividend, which adjusts put-call parity and shifts the ex-dividend pricing across the listed chain.
What is a bull call spread on HCI?
A bull call spread buys an at-the-money call and sells an out-of-the-money call at a higher strike for defined risk and defined reward bounded by the strike width.
Current HCI snapshot
As of June 29, 2026, spot at $178.32, ATM IV 31.30%, IV rank 1.41%, expected move 8.97%. The bull call spread on HCI 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 18-day expiry.
Why this bull call spread structure on HCI specifically: HCI IV at 31.30% is on the cheap side of its 1-year range, which favors premium-buying structures like a HCI bull call spread, with a market-implied 1-standard-deviation move of approximately 8.97% (roughly $16.00 on the underlying). The 18-day window matched to the front-month expiry keeps theta exposure bounded while still capturing the post-snapshot move; longer-dated HCI expiries trade a higher absolute premium for lower per-day decay. Position sizing on HCI should anchor to the underlying notional of $178.32 per share and to the trader's directional view on HCI stock.
HCI bull call spread setup
The HCI bull call 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 HCI near $178.32, the first option leg uses a $180.00 strike; additional legs (when the strategy has them) anchor to spot-relative offsets. Premiums come from the bid/ask midpoint on the listed HCI chain at a 18-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 HCI shares for the stock leg in covered calls and collars).
| Action | Type | Strike / Basis | Premium (est) |
|---|---|---|---|
| Buy 1 | Call | $180.00 | $4.65 |
| Sell 1 | Call | $185.00 | $2.45 |
HCI bull call spread risk and reward
- Net Premium / Debit
- -$220.00
- Max Profit (per contract)
- $280.00
- Max Loss (per contract)
- -$220.00
- Breakeven(s)
- $182.20
- Risk / Reward Ratio
- 1.273
Max profit equals strike width minus net debit times 100; max loss equals net debit times 100. Breakeven is long-call strike plus net debit.
HCI bull call spread payoff curve
Modeled P&L at expiration across a range of underlying prices for the bull call spread on HCI. 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% | -$220.00 |
| $39.44 | -77.9% | -$220.00 |
| $78.86 | -55.8% | -$220.00 |
| $118.29 | -33.7% | -$220.00 |
| $157.72 | -11.6% | -$220.00 |
| $197.14 | +10.6% | +$280.00 |
| $236.57 | +32.7% | +$280.00 |
| $276.00 | +54.8% | +$280.00 |
| $315.42 | +76.9% | +$280.00 |
| $354.85 | +99.0% | +$280.00 |
When traders use bull call spread on HCI
Bull call spreads on HCI reduce the cost of a bullish HCI stock position by selling a higher-strike call; suited to moderate-move theses where price reaches but does not vastly exceed the short strike.
HCI thesis for this bull call spread
The market-implied 1-standard-deviation range for HCI extends from approximately $162.32 on the downside to $194.32 on the upside. A HCI bull call spread caps both the risk and the reward of a bullish position; relative to an outright long call on HCI, the spread reduces the cost basis but limits the maximum profit to the strike width minus net debit. Current HCI IV rank near 1.41% 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 HCI at 31.30%. As a Financial Services name, HCI options can move on sector-level news flow (peer earnings, regulatory updates, industry-specific macro data) in addition to HCI-specific events.
HCI bull call spread positions are structurally moderately bullish; 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. HCI positions also carry Financial Services sector concentration risk; news flow inside the sector (peer earnings, regulatory shifts, supply-chain headlines) can move HCI alongside the broader basket even when HCI-specific fundamentals are unchanged. Long-premium structures like a bull call spread on HCI 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 HCI chain quotes before placing a trade.
Frequently asked questions
- What is a bull call spread on HCI?
- A bull call spread on HCI is the bull call spread strategy applied to HCI (stock). The strategy is structurally moderately bullish: A bull call spread buys an at-the-money call and sells an out-of-the-money call at a higher strike for defined risk and defined reward bounded by the strike width. With HCI stock trading near $178.32, the strikes shown on this page are snapped to the nearest listed HCI chain strike and the premiums come straight from the end-of-day bid/ask midpoint.
- How are HCI bull call 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-call strike plus net debit. For the HCI bull call spread priced from the end-of-day chain at a 30-day expiry (ATM IV 31.30%), the computed maximum profit is $280.00 per contract and the computed maximum loss is -$220.00 per contract. Live intraday quotes will differ as the chain moves through the trading session.
- What is the breakeven for a HCI bull call spread?
- The breakeven for the HCI bull call spread priced on this page is roughly $182.20 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 HCI market-implied 1-standard-deviation expected move is approximately 8.97%; if the move sits well outside the breakeven distance, the structure's risk-reward becomes correspondingly tighter.
- When should you consider a bull call spread on HCI?
- Bull call spreads on HCI reduce the cost of a bullish HCI stock position by selling a higher-strike call; suited to moderate-move theses where price reaches but does not vastly exceed the short strike.
- How does current HCI implied volatility affect this bull call spread?
- HCI ATM IV is at 31.30% with IV rank near 1.41%, 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.