How are HUM 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 HUM straddle priced from the end-of-day chain at a 30-day expiry (ATM IV 46.03%), the computed maximum profit is unbounded per contract and the computed maximum loss is -$2,956.44 per contract. Live intraday quotes will differ as the chain moves through the trading session.

What is the breakeven for a HUM straddle?

The breakeven for the HUM straddle priced on this page is roughly $274.30 and $335.70 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 HUM market-implied 1-standard-deviation expected move is approximately 13.20%; if the move sits well outside the breakeven distance, the structure's risk-reward becomes correspondingly tighter.

How does current HUM implied volatility affect this straddle?

HUM ATM IV is at 46.03% with IV rank near 33.82%, 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.

HUM Straddle Strategy

HUM (Humana Inc.), in the Healthcare sector, (Medical - Healthcare Plans industry), listed on NYSE.

Humana Inc., together with its subsidiaries, operates as a health and well-being company in the United States. It operates through three segments: Retail, Group and Specialty, and Healthcare Services. The company offers medical and supplemental benefit plans to individuals. It also has a contract with Centers for Medicare and Medicaid Services to administer the Limited Income Newly Eligible Transition prescription drug plan program; and contracts with various states to provide Medicaid, dual eligible, and long-term support services benefits. In addition, the company provides commercial fully insured medical and specialty health insurance benefits comprising dental, vision, and other supplemental health benefits; and administrative services only products to individuals and employer groups, as well as military services, such as TRICARE T2017 East Region contract. Further, it offers pharmacy solutions, provider services, and home solutions services, such as home health and other services to its health plan members, as well as to third parties.

HUM (Humana Inc.) trades in the Healthcare sector, specifically Medical - Healthcare Plans, with a market capitalization of approximately $36.60B, a trailing P/E of 32.46, a beta of 0.68 versus the broader market, a 52-week range of 163.11-315.35, average daily share volume of 1.8M, a public-listing history dating back to 1981, approximately 66K full-time employees. These structural characteristics shape how HUM stock options price implied volatility around earnings windows, capital events, and macro-driven sector rotations.

A beta of 0.68 indicates HUM has historically moved less than the broader market, dampening realized volatility and producing tighter expected-move bands per unit of dollar exposure. HUM pays a dividend, which adjusts put-call parity and shifts the ex-dividend pricing across the listed chain.

What is a straddle on HUM?

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 HUM snapshot

As of May 15, 2026, spot at $304.60, ATM IV 46.03%, IV rank 33.82%, expected move 13.20%. The straddle on HUM 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 HUM specifically: HUM IV at 46.03% 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 13.20% (roughly $40.19 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 HUM expiries trade a higher absolute premium for lower per-day decay. Position sizing on HUM should anchor to the underlying notional of $304.60 per share and to the trader's directional view on HUM stock.

HUM straddle setup

The HUM 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 HUM near $304.60, the first option leg uses a $305.00 strike; additional legs (when the strategy has them) anchor to spot-relative offsets. Premiums come from the bid/ask midpoint on the listed HUM 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 HUM shares for the stock leg in covered calls and collars).

Action	Type	Strike / Basis	Premium (est)
Buy 1	Call	$305.00	$16.20
Buy 1	Put	$305.00	$14.50

HUM straddle risk and reward

Net Premium / Debit: -$3,070.00
Max Profit (per contract): Unbounded
Max Loss (per contract): -$2,956.44
Breakeven(s): $274.30, $335.70
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.

HUM straddle payoff curve

Modeled P&L at expiration across a range of underlying prices for the straddle on HUM. 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%	+$27,429.00
$67.36	-77.9%	+$20,694.24
$134.71	-55.8%	+$13,959.47
$202.05	-33.7%	+$7,224.71
$269.40	-11.6%	+$489.94
$336.75	+10.6%	+$104.82
$404.10	+32.7%	+$6,839.58
$471.44	+54.8%	+$13,574.35
$538.79	+76.9%	+$20,309.11
$606.14	+99.0%	+$27,043.87

When traders use straddle on HUM

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

HUM thesis for this straddle

The market-implied 1-standard-deviation range for HUM extends from approximately $264.41 on the downside to $344.79 on the upside. A HUM 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 HUM IV rank near 33.82% is mid-range against its 1-year distribution, so the IV signal is neutral; the straddle thesis on HUM should anchor more to the directional view and the expected-move geometry. As a Healthcare name, HUM options can move on sector-level news flow (peer earnings, regulatory updates, industry-specific macro data) in addition to HUM-specific events.

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

Frequently asked questions

What is a straddle on HUM?: A straddle on HUM is the straddle strategy applied to HUM (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 HUM stock trading near $304.60, the strikes shown on this page are snapped to the nearest listed HUM chain strike and the premiums come straight from the end-of-day bid/ask midpoint.
How are HUM 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 HUM straddle priced from the end-of-day chain at a 30-day expiry (ATM IV 46.03%), the computed maximum profit is unbounded per contract and the computed maximum loss is -$2,956.44 per contract. Live intraday quotes will differ as the chain moves through the trading session.
What is the breakeven for a HUM straddle?: The breakeven for the HUM straddle priced on this page is roughly $274.30 and $335.70 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 HUM market-implied 1-standard-deviation expected move is approximately 13.20%; if the move sits well outside the breakeven distance, the structure's risk-reward becomes correspondingly tighter.
When should you consider a straddle on HUM?: Straddles on HUM are pure-volatility plays that profit from large moves in either direction; traders typically buy HUM 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 HUM implied volatility affect this straddle?: HUM ATM IV is at 46.03% with IV rank near 33.82%, 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.