MPAA Long Put Strategy
MPAA (Motorcar Parts of America, Inc.), in the Consumer Cyclical sector, (Auto - Parts industry), listed on NASDAQ.
Motorcar Parts of America, Inc. (MPAA) is a company dedicated to the production, reconditioning, and supply of essential aftermarket components for a diverse range of applications, including heavy-duty vehicles, industrial machinery, marine vessels, and agricultural equipment. The company's traditional product lines feature electrical rotating components such as alternators and starters, along with wheel hub assemblies and their corresponding bearings. Additionally, MPAA offers an extensive selection of braking system parts, including calipers, boosters, rotors, pads, and master cylinders. Expanding its expertise into advanced technologies, MPAA also furnishes sophisticated testing and diagnostic solutions for the development and manufacturing of electric vehicle (EV) powertrains. This offering includes specialized systems for testing electric motors, e-axles, advanced power emulators, and charging units. Furthermore, the company provides testing apparatus for alternators, starters, belt starter generators, and bench-top applications, alongside turbochargers and dedicated testing services for EV inverters.
MPAA (Motorcar Parts of America, Inc.) trades in the Consumer Cyclical sector, specifically Auto - Parts, with a market capitalization of approximately $293.9M, a trailing P/E of 23.91, a beta of 1.21 versus the broader market, a 52-week range of 9.29-18.12, average daily share volume of 92K, a public-listing history dating back to 1994, approximately 6K full-time employees. These structural characteristics shape how MPAA stock options price implied volatility around earnings windows, capital events, and macro-driven sector rotations.
A beta of 1.21 places MPAA roughly in line with broader market moves, so the strategy payoff and realized volatility track the index-equivalent baseline.
What is a long put on MPAA?
A long put buys downside exposure with a fixed maximum loss equal to the premium paid; profit accrues if the underlying closes below the strike minus premium at expiration.
Current MPAA snapshot
As of June 30, 2026, spot at $15.41, ATM IV 92.50%, IV rank 16.59%, expected move 26.52%. The long put on MPAA 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 17-day expiry.
Why this long put structure on MPAA specifically: MPAA IV at 92.50% is on the cheap side of its 1-year range, which favors premium-buying structures like a MPAA long put, with a market-implied 1-standard-deviation move of approximately 26.52% (roughly $4.09 on the underlying). The 17-day window matched to the front-month expiry keeps theta exposure bounded while still capturing the post-snapshot move; longer-dated MPAA expiries trade a higher absolute premium for lower per-day decay. Position sizing on MPAA should anchor to the underlying notional of $15.41 per share and to the trader's directional view on MPAA stock.
MPAA long put setup
The MPAA long put below is built from the end-of-day chain, with each option leg priced at the bid/ask midpoint of its listed strike. With MPAA near $15.41, the first option leg uses a $15.41 strike; additional legs (when the strategy has them) anchor to spot-relative offsets. Premiums come from the bid/ask midpoint on the listed MPAA chain at a 17-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 MPAA shares for the stock leg in covered calls and collars).
| Action | Type | Strike / Basis | Premium (est) |
|---|---|---|---|
| Buy 1 | Put | $15.41 | N/A |
MPAA long put risk and reward
- Net Premium / Debit
- N/A
- Max Profit (per contract)
- Unbounded
- Max Loss (per contract)
- Unbounded
- Breakeven(s)
- None on modeled curve
- Risk / Reward Ratio
- N/A
Max profit equals the strike minus premium times 100 (reached at zero); max loss equals the premium times 100. Breakeven is strike minus premium.
MPAA long put payoff curve
Modeled P&L at expiration across a range of underlying prices for the long put on MPAA. 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.
When traders use long put on MPAA
Long puts on MPAA hedge an existing long MPAA stock position or express a bearish view with defined risk; position sizing typically scales the put notional to the underlying MPAA exposure being hedged.
MPAA thesis for this long put
The market-implied 1-standard-deviation range for MPAA extends from approximately $11.32 on the downside to $19.50 on the upside. A MPAA long put expresses a directional view that the underlying closes below the strike minus premium at expiration, frequently sized to hedge an existing long MPAA position with one put per 100 shares held. Current MPAA IV rank near 16.59% 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 MPAA at 92.50%. As a Consumer Cyclical name, MPAA options can move on sector-level news flow (peer earnings, regulatory updates, industry-specific macro data) in addition to MPAA-specific events.
MPAA long put positions are structurally bearish; 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. MPAA positions also carry Consumer Cyclical sector concentration risk; news flow inside the sector (peer earnings, regulatory shifts, supply-chain headlines) can move MPAA alongside the broader basket even when MPAA-specific fundamentals are unchanged. Long-premium structures like a long put on MPAA 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 MPAA chain quotes before placing a trade.
Frequently asked questions
- What is a long put on MPAA?
- A long put on MPAA is the long put strategy applied to MPAA (stock). The strategy is structurally bearish: A long put buys downside exposure with a fixed maximum loss equal to the premium paid; profit accrues if the underlying closes below the strike minus premium at expiration. With MPAA stock trading near $15.41, the strikes shown on this page are snapped to the nearest listed MPAA chain strike and the premiums come straight from the end-of-day bid/ask midpoint.
- How are MPAA long put max profit and max loss calculated?
- Max profit equals the strike minus premium times 100 (reached at zero); max loss equals the premium times 100. Breakeven is strike minus premium. For the MPAA long put priced from the end-of-day chain at a 30-day expiry (ATM IV 92.50%), the computed maximum profit is unbounded per contract and the computed maximum loss is unbounded per contract. Live intraday quotes will differ as the chain moves through the trading session.
- What is the breakeven for a MPAA long put?
- The breakeven for the MPAA long put priced on this page is no defined breakeven on the modeled curve 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 MPAA market-implied 1-standard-deviation expected move is approximately 26.52%; if the move sits well outside the breakeven distance, the structure's risk-reward becomes correspondingly tighter.
- When should you consider a long put on MPAA?
- Long puts on MPAA hedge an existing long MPAA stock position or express a bearish view with defined risk; position sizing typically scales the put notional to the underlying MPAA exposure being hedged.
- How does current MPAA implied volatility affect this long put?
- MPAA ATM IV is at 92.50% with IV rank near 16.59%, 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.