KNF Bull Call Spread Strategy
KNF (Knife River Corporation), in the Basic Materials sector, (Construction Materials industry), listed on NYSE.
Knife River Corporation provides aggregates-based construction materials and contracting services in the United States. It operates through six segments: Pacific, Northwest, Mountain, North Central, South, and Energy Services. The company mines, processes, and sells construction aggregates, including crushed stone and sand, and gravel; and produces and sells asphalt and ready-mix concrete, as well as provides contracting services to support the aggregate-based product lines, including heavy-civil construction, asphalt and concrete paving, and site development and grading. It serves federal, state, and municipal governments for various projects, such as highways, bridges, airports, schools, public buildings, and other public-infrastructure projects. The company was founded in 1917 and is based in Bismarck, North Dakota.
KNF (Knife River Corporation) trades in the Basic Materials sector, specifically Construction Materials, with a market capitalization of approximately $4.52B, a trailing P/E of 30.81, a beta of 0.67 versus the broader market, a 52-week range of 58.72-101.1, average daily share volume of 616K, a public-listing history dating back to 2023, approximately 5K full-time employees. These structural characteristics shape how KNF stock options price implied volatility around earnings windows, capital events, and macro-driven sector rotations.
A beta of 0.67 indicates KNF has historically moved less than the broader market, dampening realized volatility and producing tighter expected-move bands per unit of dollar exposure.
What is a bull call spread on KNF?
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 KNF snapshot
As of May 15, 2026, spot at $75.66, ATM IV 45.30%, IV rank 36.11%, expected move 12.99%. The bull call spread on KNF 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 bull call spread structure on KNF specifically: KNF IV at 45.30% 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 12.99% (roughly $9.83 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 KNF expiries trade a higher absolute premium for lower per-day decay. Position sizing on KNF should anchor to the underlying notional of $75.66 per share and to the trader's directional view on KNF stock.
KNF bull call spread setup
The KNF 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 KNF near $75.66, the first option leg uses a $75.00 strike; additional legs (when the strategy has them) anchor to spot-relative offsets. Premiums come from the bid/ask midpoint on the listed KNF 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 KNF shares for the stock leg in covered calls and collars).
| Action | Type | Strike / Basis | Premium (est) |
|---|---|---|---|
| Buy 1 | Call | $75.00 | $8.75 |
| Sell 1 | Call | $80.00 | $6.60 |
KNF bull call spread risk and reward
- Net Premium / Debit
- -$215.00
- Max Profit (per contract)
- $285.00
- Max Loss (per contract)
- -$215.00
- Breakeven(s)
- $77.15
- Risk / Reward Ratio
- 1.326
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.
KNF bull call spread payoff curve
Modeled P&L at expiration across a range of underlying prices for the bull call spread on KNF. 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% | -$215.00 |
| $16.74 | -77.9% | -$215.00 |
| $33.47 | -55.8% | -$215.00 |
| $50.19 | -33.7% | -$215.00 |
| $66.92 | -11.6% | -$215.00 |
| $83.65 | +10.6% | +$285.00 |
| $100.38 | +32.7% | +$285.00 |
| $117.10 | +54.8% | +$285.00 |
| $133.83 | +76.9% | +$285.00 |
| $150.56 | +99.0% | +$285.00 |
When traders use bull call spread on KNF
Bull call spreads on KNF reduce the cost of a bullish KNF stock position by selling a higher-strike call; suited to moderate-move theses where price reaches but does not vastly exceed the short strike.
KNF thesis for this bull call spread
The market-implied 1-standard-deviation range for KNF extends from approximately $65.83 on the downside to $85.49 on the upside. A KNF bull call spread caps both the risk and the reward of a bullish position; relative to an outright long call on KNF, the spread reduces the cost basis but limits the maximum profit to the strike width minus net debit. Current KNF IV rank near 36.11% is mid-range against its 1-year distribution, so the IV signal is neutral; the bull call spread thesis on KNF should anchor more to the directional view and the expected-move geometry. As a Basic Materials name, KNF options can move on sector-level news flow (peer earnings, regulatory updates, industry-specific macro data) in addition to KNF-specific events.
KNF 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. KNF positions also carry Basic Materials sector concentration risk; news flow inside the sector (peer earnings, regulatory shifts, supply-chain headlines) can move KNF alongside the broader basket even when KNF-specific fundamentals are unchanged. Long-premium structures like a bull call spread on KNF 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 KNF chain quotes before placing a trade.
Frequently asked questions
- What is a bull call spread on KNF?
- A bull call spread on KNF is the bull call spread strategy applied to KNF (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 KNF stock trading near $75.66, the strikes shown on this page are snapped to the nearest listed KNF chain strike and the premiums come straight from the end-of-day bid/ask midpoint.
- How are KNF 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 KNF bull call spread priced from the end-of-day chain at a 30-day expiry (ATM IV 45.30%), the computed maximum profit is $285.00 per contract and the computed maximum loss is -$215.00 per contract. Live intraday quotes will differ as the chain moves through the trading session.
- What is the breakeven for a KNF bull call spread?
- The breakeven for the KNF bull call spread priced on this page is roughly $77.15 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 KNF market-implied 1-standard-deviation expected move is approximately 12.99%; 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 KNF?
- Bull call spreads on KNF reduce the cost of a bullish KNF 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 KNF implied volatility affect this bull call spread?
- KNF ATM IV is at 45.30% with IV rank near 36.11%, 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.