LION Straddle Strategy
LION (Lionsgate Studios Corp.), in the Communication Services sector, (Entertainment industry), listed on NYSE.
Lionsgate Studios is one of the world’s leading standalone, pure play, publicly-traded content companies. It brings together diversified motion picture and television production and distribution businesses, a world-class portfolio of valuable brands and franchises, a talent management and production powerhouse and a more than 20,000-title film and television library, all driven by Lionsgate’s bold and entrepreneurial culture.
LION (Lionsgate Studios Corp.) trades in the Communication Services sector, specifically Entertainment, with a market capitalization of approximately $3.64B, a beta of 0.10 versus the broader market, a 52-week range of 5.545-13, average daily share volume of 3.0M, a public-listing history dating back to 2022, approximately 2K full-time employees. These structural characteristics shape how LION stock options price implied volatility around earnings windows, capital events, and macro-driven sector rotations.
A beta of 0.10 indicates LION 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 straddle on LION?
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 LION snapshot
As of May 14, 2026, spot at $12.68, ATM IV 68.10%, IV rank 6.84%, expected move 19.52%. The straddle on LION 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 34-day expiry.
Why this straddle structure on LION specifically: LION IV at 68.10% is on the cheap side of its 1-year range, which favors premium-buying structures like a LION straddle, with a market-implied 1-standard-deviation move of approximately 19.52% (roughly $2.48 on the underlying). The 34-day window matched to the front-month expiry keeps theta exposure bounded while still capturing the post-snapshot move; longer-dated LION expiries trade a higher absolute premium for lower per-day decay. Position sizing on LION should anchor to the underlying notional of $12.68 per share and to the trader's directional view on LION stock.
LION straddle setup
The LION 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 LION near $12.68, the first option leg uses a $13.00 strike; additional legs (when the strategy has them) anchor to spot-relative offsets. Premiums come from the bid/ask midpoint on the listed LION chain at a 34-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 LION shares for the stock leg in covered calls and collars).
| Action | Type | Strike / Basis | Premium (est) |
|---|---|---|---|
| Buy 1 | Call | $13.00 | $0.95 |
| Buy 1 | Put | $13.00 | $1.38 |
LION straddle risk and reward
- Net Premium / Debit
- -$232.50
- Max Profit (per contract)
- Unbounded
- Max Loss (per contract)
- -$232.15
- Breakeven(s)
- $10.68, $15.33
- 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.
LION straddle payoff curve
Modeled P&L at expiration across a range of underlying prices for the straddle on LION. 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 | -99.9% | +$1,066.50 |
| $2.81 | -77.8% | +$786.25 |
| $5.62 | -55.7% | +$506.00 |
| $8.42 | -33.6% | +$225.75 |
| $11.22 | -11.5% | -$54.51 |
| $14.02 | +10.6% | -$130.24 |
| $16.83 | +32.7% | +$150.01 |
| $19.63 | +54.8% | +$430.26 |
| $22.43 | +76.9% | +$710.51 |
| $25.23 | +99.0% | +$990.76 |
When traders use straddle on LION
Straddles on LION are pure-volatility plays that profit from large moves in either direction; traders typically buy LION straddles ahead of earnings, FDA decisions, or other catalysts where the realized move is expected to exceed the implied move priced into the chain.
LION thesis for this straddle
The market-implied 1-standard-deviation range for LION extends from approximately $10.20 on the downside to $15.16 on the upside. A LION 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 LION IV rank near 6.84% 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 LION at 68.10%. As a Communication Services name, LION options can move on sector-level news flow (peer earnings, regulatory updates, industry-specific macro data) in addition to LION-specific events.
LION 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. LION positions also carry Communication Services sector concentration risk; news flow inside the sector (peer earnings, regulatory shifts, supply-chain headlines) can move LION alongside the broader basket even when LION-specific fundamentals are unchanged. Always rebuild the position from current LION chain quotes before placing a trade.
Frequently asked questions
- What is a straddle on LION?
- A straddle on LION is the straddle strategy applied to LION (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 LION stock trading near $12.68, the strikes shown on this page are snapped to the nearest listed LION chain strike and the premiums come straight from the end-of-day bid/ask midpoint.
- How are LION 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 LION straddle priced from the end-of-day chain at a 30-day expiry (ATM IV 68.10%), the computed maximum profit is unbounded per contract and the computed maximum loss is -$232.15 per contract. Live intraday quotes will differ as the chain moves through the trading session.
- What is the breakeven for a LION straddle?
- The breakeven for the LION straddle priced on this page is roughly $10.68 and $15.33 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 LION market-implied 1-standard-deviation expected move is approximately 19.52%; if the move sits well outside the breakeven distance, the structure's risk-reward becomes correspondingly tighter.
- When should you consider a straddle on LION?
- Straddles on LION are pure-volatility plays that profit from large moves in either direction; traders typically buy LION 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 LION implied volatility affect this straddle?
- LION ATM IV is at 68.10% with IV rank near 6.84%, 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.