INSP Straddle Strategy
INSP (Inspire Medical Systems, Inc.), in the Healthcare sector, (Medical - Devices industry), listed on NYSE.
Inspire Medical Systems, Inc., a medical technology company, focuses on the development and commercialization of minimally invasive solutions for patients with obstructive sleep apnea (OSA) in the United States and internationally. The company offers Inspire system, a neurostimulation technology that provides a safe and effective treatment for moderate to severe OSA. It also develops a novel, a closed-loop solution that continuously monitors a patient's breathing and delivers mild hypoglossal nerve stimulation to maintain an open airway. The company was incorporated in 2007 and is headquartered in Golden Valley, Minnesota.
INSP (Inspire Medical Systems, Inc.) trades in the Healthcare sector, specifically Medical - Devices, with a market capitalization of approximately $1.21B, a trailing P/E of 9.17, a beta of 0.83 versus the broader market, a 52-week range of 41.55-156.815, average daily share volume of 1.2M, a public-listing history dating back to 2018, approximately 1K full-time employees. These structural characteristics shape how INSP stock options price implied volatility around earnings windows, capital events, and macro-driven sector rotations.
A beta of 0.83 places INSP roughly in line with broader market moves, so the strategy payoff and realized volatility track the index-equivalent baseline. The trailing P/E of 9.17 is on the value side, where IV often compresses outside event windows because forward growth expectations are already discounted into the share price.
What is a straddle on INSP?
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 INSP snapshot
As of May 15, 2026, spot at $40.30, ATM IV 72.40%, IV rank 30.47%, expected move 20.76%. The straddle on INSP 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 98-day expiry.
Why this straddle structure on INSP specifically: INSP IV at 72.40% 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 20.76% (roughly $8.36 on the underlying). The 98-day window matched to the front-month expiry keeps theta exposure bounded while still capturing the post-snapshot move; longer-dated INSP expiries trade a higher absolute premium for lower per-day decay. Position sizing on INSP should anchor to the underlying notional of $40.30 per share and to the trader's directional view on INSP stock.
INSP straddle setup
The INSP 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 INSP near $40.30, the first option leg uses a $40.00 strike; additional legs (when the strategy has them) anchor to spot-relative offsets. Premiums come from the bid/ask midpoint on the listed INSP chain at a 98-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 INSP shares for the stock leg in covered calls and collars).
| Action | Type | Strike / Basis | Premium (est) |
|---|---|---|---|
| Buy 1 | Call | $40.00 | $7.00 |
| Buy 1 | Put | $40.00 | $5.65 |
INSP straddle risk and reward
- Net Premium / Debit
- -$1,265.00
- Max Profit (per contract)
- Unbounded
- Max Loss (per contract)
- -$1,254.75
- Breakeven(s)
- $27.35, $52.65
- 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.
INSP straddle payoff curve
Modeled P&L at expiration across a range of underlying prices for the straddle on INSP. 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% | +$2,734.00 |
| $8.92 | -77.9% | +$1,843.06 |
| $17.83 | -55.8% | +$952.11 |
| $26.74 | -33.7% | +$61.17 |
| $35.65 | -11.5% | -$829.78 |
| $44.56 | +10.6% | -$809.28 |
| $53.47 | +32.7% | +$81.67 |
| $62.38 | +54.8% | +$972.61 |
| $71.29 | +76.9% | +$1,863.56 |
| $80.20 | +99.0% | +$2,754.50 |
When traders use straddle on INSP
Straddles on INSP are pure-volatility plays that profit from large moves in either direction; traders typically buy INSP straddles ahead of earnings, FDA decisions, or other catalysts where the realized move is expected to exceed the implied move priced into the chain.
INSP thesis for this straddle
The market-implied 1-standard-deviation range for INSP extends from approximately $31.94 on the downside to $48.66 on the upside. A INSP 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 INSP IV rank near 30.47% is mid-range against its 1-year distribution, so the IV signal is neutral; the straddle thesis on INSP should anchor more to the directional view and the expected-move geometry. As a Healthcare name, INSP options can move on sector-level news flow (peer earnings, regulatory updates, industry-specific macro data) in addition to INSP-specific events.
INSP 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. INSP positions also carry Healthcare sector concentration risk; news flow inside the sector (peer earnings, regulatory shifts, supply-chain headlines) can move INSP alongside the broader basket even when INSP-specific fundamentals are unchanged. Always rebuild the position from current INSP chain quotes before placing a trade.
Frequently asked questions
- What is a straddle on INSP?
- A straddle on INSP is the straddle strategy applied to INSP (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 INSP stock trading near $40.30, the strikes shown on this page are snapped to the nearest listed INSP chain strike and the premiums come straight from the end-of-day bid/ask midpoint.
- How are INSP 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 INSP straddle priced from the end-of-day chain at a 30-day expiry (ATM IV 72.40%), the computed maximum profit is unbounded per contract and the computed maximum loss is -$1,254.75 per contract. Live intraday quotes will differ as the chain moves through the trading session.
- What is the breakeven for a INSP straddle?
- The breakeven for the INSP straddle priced on this page is roughly $27.35 and $52.65 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 INSP market-implied 1-standard-deviation expected move is approximately 20.76%; if the move sits well outside the breakeven distance, the structure's risk-reward becomes correspondingly tighter.
- When should you consider a straddle on INSP?
- Straddles on INSP are pure-volatility plays that profit from large moves in either direction; traders typically buy INSP 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 INSP implied volatility affect this straddle?
- INSP ATM IV is at 72.40% with IV rank near 30.47%, 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.