LUNR Straddle Strategy
LUNR (Intuitive Machines, Inc.), in the Industrials sector, (Aerospace & Defense industry), listed on NASDAQ.
Intuitive Machines, Inc. manufactures and supplies space products and services. It offers space products and services to support sustained robotic and human exploration to the moon, mars, and beyond. It offers its products and services through business units: Lunar Access Services, Orbital Services, Lunar Data Services, and Space Products and Infrastructure. The company was founded in 2013 and is based in Houston, Texas.
LUNR (Intuitive Machines, Inc.) trades in the Industrials sector, specifically Aerospace & Defense, with a market capitalization of approximately $5.69B, a beta of 1.47 versus the broader market, a 52-week range of 7.78-36.72, average daily share volume of 13.2M, a public-listing history dating back to 2021, approximately 435 full-time employees. These structural characteristics shape how LUNR stock options price implied volatility around earnings windows, capital events, and macro-driven sector rotations.
A beta of 1.47 indicates LUNR has historically moved more than the broader market, amplifying both the directional payoff and the realized volatility relative to an index-equivalent position.
What is a straddle on LUNR?
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 LUNR snapshot
As of May 15, 2026, spot at $34.66, ATM IV 119.55%, IV rank 58.90%, expected move 34.27%. The straddle on LUNR 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 LUNR specifically: LUNR IV at 119.55% 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 34.27% (roughly $11.88 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 LUNR expiries trade a higher absolute premium for lower per-day decay. Position sizing on LUNR should anchor to the underlying notional of $34.66 per share and to the trader's directional view on LUNR stock.
LUNR straddle setup
The LUNR 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 LUNR near $34.66, the first option leg uses a $35.00 strike; additional legs (when the strategy has them) anchor to spot-relative offsets. Premiums come from the bid/ask midpoint on the listed LUNR 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 LUNR shares for the stock leg in covered calls and collars).
| Action | Type | Strike / Basis | Premium (est) |
|---|---|---|---|
| Buy 1 | Call | $35.00 | $4.48 |
| Buy 1 | Put | $35.00 | $4.70 |
LUNR straddle risk and reward
- Net Premium / Debit
- -$917.50
- Max Profit (per contract)
- Unbounded
- Max Loss (per contract)
- -$901.41
- Breakeven(s)
- $25.83, $44.18
- 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.
LUNR straddle payoff curve
Modeled P&L at expiration across a range of underlying prices for the straddle on LUNR. 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% | +$2,581.50 |
| $7.67 | -77.9% | +$1,815.26 |
| $15.33 | -55.8% | +$1,049.02 |
| $23.00 | -33.6% | +$282.78 |
| $30.66 | -11.5% | -$483.46 |
| $38.32 | +10.6% | -$585.29 |
| $45.98 | +32.7% | +$180.95 |
| $53.65 | +54.8% | +$947.19 |
| $61.31 | +76.9% | +$1,713.43 |
| $68.97 | +99.0% | +$2,479.67 |
When traders use straddle on LUNR
Straddles on LUNR are pure-volatility plays that profit from large moves in either direction; traders typically buy LUNR straddles ahead of earnings, FDA decisions, or other catalysts where the realized move is expected to exceed the implied move priced into the chain.
LUNR thesis for this straddle
The market-implied 1-standard-deviation range for LUNR extends from approximately $22.78 on the downside to $46.54 on the upside. A LUNR 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 LUNR IV rank near 58.90% is mid-range against its 1-year distribution, so the IV signal is neutral; the straddle thesis on LUNR should anchor more to the directional view and the expected-move geometry. As a Industrials name, LUNR options can move on sector-level news flow (peer earnings, regulatory updates, industry-specific macro data) in addition to LUNR-specific events.
LUNR 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. LUNR positions also carry Industrials sector concentration risk; news flow inside the sector (peer earnings, regulatory shifts, supply-chain headlines) can move LUNR alongside the broader basket even when LUNR-specific fundamentals are unchanged. Always rebuild the position from current LUNR chain quotes before placing a trade.
Frequently asked questions
- What is a straddle on LUNR?
- A straddle on LUNR is the straddle strategy applied to LUNR (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 LUNR stock trading near $34.66, the strikes shown on this page are snapped to the nearest listed LUNR chain strike and the premiums come straight from the end-of-day bid/ask midpoint.
- How are LUNR 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 LUNR straddle priced from the end-of-day chain at a 30-day expiry (ATM IV 119.55%), the computed maximum profit is unbounded per contract and the computed maximum loss is -$901.41 per contract. Live intraday quotes will differ as the chain moves through the trading session.
- What is the breakeven for a LUNR straddle?
- The breakeven for the LUNR straddle priced on this page is roughly $25.83 and $44.18 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 LUNR market-implied 1-standard-deviation expected move is approximately 34.27%; if the move sits well outside the breakeven distance, the structure's risk-reward becomes correspondingly tighter.
- When should you consider a straddle on LUNR?
- Straddles on LUNR are pure-volatility plays that profit from large moves in either direction; traders typically buy LUNR 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 LUNR implied volatility affect this straddle?
- LUNR ATM IV is at 119.55% with IV rank near 58.90%, 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.