How are MLI 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 MLI straddle priced from the end-of-day chain at a 30-day expiry (ATM IV 32.10%), the computed maximum profit is unbounded per contract and the computed maximum loss is -$676.63 per contract. Live intraday quotes will differ as the chain moves through the trading session.

What is the breakeven for a MLI straddle?

The breakeven for the MLI straddle priced on this page is roughly $117.90 and $132.10 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 MLI market-implied 1-standard-deviation expected move is approximately 9.20%; if the move sits well outside the breakeven distance, the structure's risk-reward becomes correspondingly tighter.

How does current MLI implied volatility affect this straddle?

MLI ATM IV is at 32.10% with IV rank near 70.71%, which is elevated relative to its 1-year range. Premium-selling structures (covered call, cash-secured put, iron condor) generally look more attractive when IV rank is high; premium-buying structures (long call, long put, debit spreads) are more expensive in that regime.

MLI Straddle Strategy

MLI (Mueller Industries, Inc.), in the Industrials sector, (Manufacturing - Metal Fabrication industry), listed on NYSE.

Mueller Industries, Inc., established in 1917 and based in Collierville, Tennessee, is a global manufacturer and distributor of various products crafted from copper, brass, aluminum, and plastic. The company operates internationally, with a presence in the United States, the United Kingdom, Canada, South Korea, the Middle East, China, and Mexico. Its business is divided into three key segments: Piping Systems, Industrial Metals, and Climate. The Piping Systems segment offers a comprehensive range of products including copper tubing, fittings, line sets, and pipe nipples. It also provides PEX plumbing and radiant heating systems, as well as plastic injection tooling. Additionally, this segment resells items such as steel pipes, brass and plastic plumbing valves, malleable iron fittings, faucets, and other plumbing specialties, alongside supplying water tubes.

MLI (Mueller Industries, Inc.) trades in the Industrials sector, specifically Manufacturing - Metal Fabrication, with a market capitalization of approximately $14.18B, a trailing P/E of 16.52, a beta of 1.11 versus the broader market, a 52-week range of 78.57-141.9, average daily share volume of 678K, a public-listing history dating back to 1991, approximately 5K full-time employees. These structural characteristics shape how MLI stock options price implied volatility around earnings windows, capital events, and macro-driven sector rotations.

A beta of 1.11 places MLI roughly in line with broader market moves, so the strategy payoff and realized volatility track the index-equivalent baseline. MLI pays a dividend, which adjusts put-call parity and shifts the ex-dividend pricing across the listed chain.

What is a straddle on MLI?

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 MLI snapshot

As of June 29, 2026, spot at $122.81, ATM IV 32.10%, IV rank 70.71%, expected move 9.20%. The straddle on MLI 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 18-day expiry.

Why this straddle structure on MLI specifically: MLI IV at 32.10% is rich versus its 1-year range, which makes a premium-buying MLI straddle relatively expensive in absolute-cost terms, with a market-implied 1-standard-deviation move of approximately 9.20% (roughly $11.30 on the underlying). The 18-day window matched to the front-month expiry keeps theta exposure bounded while still capturing the post-snapshot move; longer-dated MLI expiries trade a higher absolute premium for lower per-day decay. Position sizing on MLI should anchor to the underlying notional of $122.81 per share and to the trader's directional view on MLI stock.

MLI straddle setup

The MLI 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 MLI near $122.81, the first option leg uses a $125.00 strike; additional legs (when the strategy has them) anchor to spot-relative offsets. Premiums come from the bid/ask midpoint on the listed MLI chain at a 18-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 MLI shares for the stock leg in covered calls and collars).

Action	Type	Strike / Basis	Premium (est)
Buy 1	Call	$125.00	$2.40
Buy 1	Put	$125.00	$4.70

MLI straddle risk and reward

Net Premium / Debit: -$710.00
Max Profit (per contract): Unbounded
Max Loss (per contract): -$676.63
Breakeven(s): $117.90, $132.10
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.

MLI straddle payoff curve

Modeled P&L at expiration across a range of underlying prices for the straddle on MLI. 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.

P&L at expiration across the modeled underlying-price range. Green shading marks profitable regions, red shading marks loss regions. Dotted purple verticals mark breakevens; the solid dark vertical marks current spot.

Underlying Price	% From Spot	P&L at Expiration
$0.01	-100.0%	+$11,789.00
$27.16	-77.9%	+$9,073.71
$54.32	-55.8%	+$6,358.43
$81.47	-33.7%	+$3,643.14
$108.62	-11.6%	+$927.85
$135.77	+10.6%	+$367.43
$162.93	+32.7%	+$3,082.72
$190.08	+54.8%	+$5,798.01
$217.23	+76.9%	+$8,513.29
$244.39	+99.0%	+$11,228.58

When traders use straddle on MLI

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

MLI thesis for this straddle

The market-implied 1-standard-deviation range for MLI extends from approximately $111.51 on the downside to $134.11 on the upside. A MLI 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 MLI IV rank near 70.71% sits in the upper third of its 1-year distribution, which historically reverts; this raises the bar for premium-buying structures and lowers it for premium-selling structures on MLI at 32.10%. As a Industrials name, MLI options can move on sector-level news flow (peer earnings, regulatory updates, industry-specific macro data) in addition to MLI-specific events.

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

Frequently asked questions

What is a straddle on MLI?: A straddle on MLI is the straddle strategy applied to MLI (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 MLI stock trading near $122.81, the strikes shown on this page are snapped to the nearest listed MLI chain strike and the premiums come straight from the end-of-day bid/ask midpoint.
How are MLI 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 MLI straddle priced from the end-of-day chain at a 30-day expiry (ATM IV 32.10%), the computed maximum profit is unbounded per contract and the computed maximum loss is -$676.63 per contract. Live intraday quotes will differ as the chain moves through the trading session.
What is the breakeven for a MLI straddle?: The breakeven for the MLI straddle priced on this page is roughly $117.90 and $132.10 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 MLI market-implied 1-standard-deviation expected move is approximately 9.20%; if the move sits well outside the breakeven distance, the structure's risk-reward becomes correspondingly tighter.
When should you consider a straddle on MLI?: Straddles on MLI are pure-volatility plays that profit from large moves in either direction; traders typically buy MLI 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 MLI implied volatility affect this straddle?: MLI ATM IV is at 32.10% with IV rank near 70.71%, which is elevated relative to its 1-year range. Premium-selling structures (covered call, cash-secured put, iron condor) generally look more attractive when IV rank is high; premium-buying structures (long call, long put, debit spreads) are more expensive in that regime.