How are PAYC strangle max profit and max loss calculated?

Upside max profit is unbounded; downside max profit is bounded at the put strike minus the combined debit (reached at zero). Max loss equals the combined debit times 100 (reached anywhere between the two OTM strikes). Two breakevens at call-strike plus debit and put-strike minus debit. For the PAYC strangle priced from the end-of-day chain at a 30-day expiry (ATM IV 47.30%), the computed maximum profit is unbounded per contract and the computed maximum loss is -$920.00 per contract. Live intraday quotes will differ as the chain moves through the trading session.

What is the breakeven for a PAYC strangle?

The breakeven for the PAYC strangle priced on this page is roughly $120.80 and $154.20 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 PAYC market-implied 1-standard-deviation expected move is approximately 13.56%; if the move sits well outside the breakeven distance, the structure's risk-reward becomes correspondingly tighter.

How does current PAYC implied volatility affect this strangle?

PAYC ATM IV is at 47.30% with IV rank near 25.18%, 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.

PAYC Strangle Strategy

PAYC (Paycom Software, Inc.), in the Technology sector, (Software - Application industry), listed on NYSE.

Paycom Software, Inc. provides cloud-based human capital management (HCM) solution delivered as software-as-a-service for small to mid-sized companies in the United States. It offers functionality and data analytics that businesses need to manage the employment life cycle from recruitment to retirement. The company's HCM solution provides a suite of applications in the areas of talent acquisition, including applicant tracking, candidate tracker, background checks, on-boarding, e-verify, and tax credit services; and time and labor management, such as time and attendance, scheduling/schedule exchange, time-off requests, labor allocation, labor management reports/push reporting, and geofencing/geotracking, and Microfence, a proprietary Bluetooth. Its HCM solution also offers payroll applications comprising better employee transaction interface, payroll and tax management, Paycom pay, expense management, mileage tracker/fixed and variable rates, garnishment management, and GL concierge applications; and talent management applications that include employee self-service, compensation budgeting, performance management, position management, and Paycom learning and content subscriptions, as well as my analytics, which offer employment predictor reporting. In addition, its HCM solution provides manager on-the-go that gives supervisors and managers the ability to perform a variety of tasks, such as approving time-off requests and expense reimbursements; direct data exchange; ask here, a tool for direct line of communication to ask work-related questions; document and checklist; government and compliance; benefits administration/benefits to carrier; COBRA administration; personnel action and performance discussion forms; surveys; and affordable care act applications, as well as Clue, which securely collect, track, and manage the vaccination and testing data of the workforce. Paycom Software, Inc. was founded in 1998 and is headquartered in Oklahoma City, Oklahoma.

PAYC (Paycom Software, Inc.) trades in the Technology sector, specifically Software - Application, with a market capitalization of approximately $7.36B, a trailing P/E of 14.68, a beta of 0.78 versus the broader market, a 52-week range of 104.9-267.76, average daily share volume of 1.7M, a public-listing history dating back to 2014, approximately 6K full-time employees. These structural characteristics shape how PAYC stock options price implied volatility around earnings windows, capital events, and macro-driven sector rotations.

A beta of 0.78 places PAYC roughly in line with broader market moves, so the strategy payoff and realized volatility track the index-equivalent baseline. PAYC pays a dividend, which adjusts put-call parity and shifts the ex-dividend pricing across the listed chain.

What is a strangle on PAYC?

A long strangle buys an OTM call and an OTM put at offset strikes, cheaper than a straddle but requiring a larger underlying move to profit since both wings start out-of-the-money.

Current PAYC snapshot

As of May 15, 2026, spot at $136.25, ATM IV 47.30%, IV rank 25.18%, expected move 13.56%. The strangle on PAYC 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 strangle structure on PAYC specifically: PAYC IV at 47.30% is on the cheap side of its 1-year range, which favors premium-buying structures like a PAYC strangle, with a market-implied 1-standard-deviation move of approximately 13.56% (roughly $18.48 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 PAYC expiries trade a higher absolute premium for lower per-day decay. Position sizing on PAYC should anchor to the underlying notional of $136.25 per share and to the trader's directional view on PAYC stock.

PAYC strangle setup

The PAYC strangle below is built from the end-of-day chain, with each option leg priced at the bid/ask midpoint of its listed strike. With PAYC near $136.25, the first option leg uses a $145.00 strike; additional legs (when the strategy has them) anchor to spot-relative offsets. Premiums come from the bid/ask midpoint on the listed PAYC 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 PAYC shares for the stock leg in covered calls and collars).

Action	Type	Strike / Basis	Premium (est)
Buy 1	Call	$145.00	$4.55
Buy 1	Put	$130.00	$4.65

PAYC strangle risk and reward

Net Premium / Debit: -$920.00
Max Profit (per contract): Unbounded
Max Loss (per contract): -$920.00
Breakeven(s): $120.80, $154.20
Risk / Reward Ratio: Unbounded

Upside max profit is unbounded; downside max profit is bounded at the put strike minus the combined debit (reached at zero). Max loss equals the combined debit times 100 (reached anywhere between the two OTM strikes). Two breakevens at call-strike plus debit and put-strike minus debit.

PAYC strangle payoff curve

Modeled P&L at expiration across a range of underlying prices for the strangle on PAYC. 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%	+$12,079.00
$30.13	-77.9%	+$9,066.55
$60.26	-55.8%	+$6,054.10
$90.38	-33.7%	+$3,041.64
$120.51	-11.6%	+$29.19
$150.63	+10.6%	-$356.74
$180.76	+32.7%	+$2,655.71
$210.88	+54.8%	+$5,668.17
$241.01	+76.9%	+$8,680.62
$271.13	+99.0%	+$11,693.07

When traders use strangle on PAYC

Strangles on PAYC are the cheaper cousin of the straddle - traders use them when they want a large directional move but are willing to give up the inner-strike sensitivity in exchange for a lower up-front debit on the PAYC chain.

PAYC thesis for this strangle

The market-implied 1-standard-deviation range for PAYC extends from approximately $117.77 on the downside to $154.73 on the upside. A PAYC long strangle is the OTM cousin of the straddle: lower up-front cost but the underlying has to travel further past either OTM strike before the position turns profitable at expiration. Current PAYC IV rank near 25.18% 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 PAYC at 47.30%. As a Technology name, PAYC options can move on sector-level news flow (peer earnings, regulatory updates, industry-specific macro data) in addition to PAYC-specific events.

PAYC strangle positions are structurally neutral / high-volatility (long premium, OTM); 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. PAYC positions also carry Technology sector concentration risk; news flow inside the sector (peer earnings, regulatory shifts, supply-chain headlines) can move PAYC alongside the broader basket even when PAYC-specific fundamentals are unchanged. Always rebuild the position from current PAYC chain quotes before placing a trade.

Frequently asked questions

What is a strangle on PAYC?: A strangle on PAYC is the strangle strategy applied to PAYC (stock). The strategy is structurally neutral / high-volatility (long premium, OTM): A long strangle buys an OTM call and an OTM put at offset strikes, cheaper than a straddle but requiring a larger underlying move to profit since both wings start out-of-the-money. With PAYC stock trading near $136.25, the strikes shown on this page are snapped to the nearest listed PAYC chain strike and the premiums come straight from the end-of-day bid/ask midpoint.
How are PAYC strangle max profit and max loss calculated?: Upside max profit is unbounded; downside max profit is bounded at the put strike minus the combined debit (reached at zero). Max loss equals the combined debit times 100 (reached anywhere between the two OTM strikes). Two breakevens at call-strike plus debit and put-strike minus debit. For the PAYC strangle priced from the end-of-day chain at a 30-day expiry (ATM IV 47.30%), the computed maximum profit is unbounded per contract and the computed maximum loss is -$920.00 per contract. Live intraday quotes will differ as the chain moves through the trading session.
What is the breakeven for a PAYC strangle?: The breakeven for the PAYC strangle priced on this page is roughly $120.80 and $154.20 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 PAYC market-implied 1-standard-deviation expected move is approximately 13.56%; if the move sits well outside the breakeven distance, the structure's risk-reward becomes correspondingly tighter.
When should you consider a strangle on PAYC?: Strangles on PAYC are the cheaper cousin of the straddle - traders use them when they want a large directional move but are willing to give up the inner-strike sensitivity in exchange for a lower up-front debit on the PAYC chain.
How does current PAYC implied volatility affect this strangle?: PAYC ATM IV is at 47.30% with IV rank near 25.18%, 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.