PCG Straddle Strategy
PCG (PG&E Corporation), in the Utilities sector, (Regulated Electric industry), listed on NYSE.
PG&E Corp. operates as a holding company, which engages in generation, transmission, and distribution of electricity and natural gas to customers. It specializes in energy, utility, power, gas, electricity, solar and sustainability. The company was founded in 1995 and is headquartered in Oakland, CA.
PCG (PG&E Corporation) trades in the Utilities sector, specifically Regulated Electric, with a market capitalization of approximately $36.56B, a trailing P/E of 12.36, a beta of 0.29 versus the broader market, a 52-week range of 12.97-19.16, average daily share volume of 22.1M, a public-listing history dating back to 1972, approximately 28K full-time employees. These structural characteristics shape how PCG stock options price implied volatility around earnings windows, capital events, and macro-driven sector rotations.
A beta of 0.29 indicates PCG has historically moved less than the broader market, dampening realized volatility and producing tighter expected-move bands per unit of dollar exposure. PCG pays a dividend, which adjusts put-call parity and shifts the ex-dividend pricing across the listed chain.
What is a straddle on PCG?
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 PCG snapshot
As of May 15, 2026, spot at $16.19, ATM IV 30.89%, IV rank 28.44%, expected move 8.86%. The straddle on PCG 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 PCG specifically: PCG IV at 30.89% is on the cheap side of its 1-year range, which favors premium-buying structures like a PCG straddle, with a market-implied 1-standard-deviation move of approximately 8.86% (roughly $1.43 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 PCG expiries trade a higher absolute premium for lower per-day decay. Position sizing on PCG should anchor to the underlying notional of $16.19 per share and to the trader's directional view on PCG stock.
PCG straddle setup
The PCG 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 PCG near $16.19, the first option leg uses a $16.00 strike; additional legs (when the strategy has them) anchor to spot-relative offsets. Premiums come from the bid/ask midpoint on the listed PCG 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 PCG shares for the stock leg in covered calls and collars).
| Action | Type | Strike / Basis | Premium (est) |
|---|---|---|---|
| Buy 1 | Call | $16.00 | $0.62 |
| Buy 1 | Put | $16.00 | $0.46 |
PCG straddle risk and reward
- Net Premium / Debit
- -$108.00
- Max Profit (per contract)
- Unbounded
- Max Loss (per contract)
- -$103.10
- Breakeven(s)
- $14.92, $17.08
- 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.
PCG straddle payoff curve
Modeled P&L at expiration across a range of underlying prices for the straddle on PCG. 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% | +$1,491.00 |
| $3.59 | -77.8% | +$1,133.14 |
| $7.17 | -55.7% | +$775.28 |
| $10.75 | -33.6% | +$417.42 |
| $14.32 | -11.5% | +$59.56 |
| $17.90 | +10.6% | +$82.30 |
| $21.48 | +32.7% | +$440.16 |
| $25.06 | +54.8% | +$798.02 |
| $28.64 | +76.9% | +$1,155.87 |
| $32.22 | +99.0% | +$1,513.73 |
When traders use straddle on PCG
Straddles on PCG are pure-volatility plays that profit from large moves in either direction; traders typically buy PCG straddles ahead of earnings, FDA decisions, or other catalysts where the realized move is expected to exceed the implied move priced into the chain.
PCG thesis for this straddle
The market-implied 1-standard-deviation range for PCG extends from approximately $14.76 on the downside to $17.62 on the upside. A PCG 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 PCG IV rank near 28.44% 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 PCG at 30.89%. As a Utilities name, PCG options can move on sector-level news flow (peer earnings, regulatory updates, industry-specific macro data) in addition to PCG-specific events.
PCG 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. PCG positions also carry Utilities sector concentration risk; news flow inside the sector (peer earnings, regulatory shifts, supply-chain headlines) can move PCG alongside the broader basket even when PCG-specific fundamentals are unchanged. Always rebuild the position from current PCG chain quotes before placing a trade.
Frequently asked questions
- What is a straddle on PCG?
- A straddle on PCG is the straddle strategy applied to PCG (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 PCG stock trading near $16.19, the strikes shown on this page are snapped to the nearest listed PCG chain strike and the premiums come straight from the end-of-day bid/ask midpoint.
- How are PCG 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 PCG straddle priced from the end-of-day chain at a 30-day expiry (ATM IV 30.89%), the computed maximum profit is unbounded per contract and the computed maximum loss is -$103.10 per contract. Live intraday quotes will differ as the chain moves through the trading session.
- What is the breakeven for a PCG straddle?
- The breakeven for the PCG straddle priced on this page is roughly $14.92 and $17.08 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 PCG market-implied 1-standard-deviation expected move is approximately 8.86%; if the move sits well outside the breakeven distance, the structure's risk-reward becomes correspondingly tighter.
- When should you consider a straddle on PCG?
- Straddles on PCG are pure-volatility plays that profit from large moves in either direction; traders typically buy PCG 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 PCG implied volatility affect this straddle?
- PCG ATM IV is at 30.89% with IV rank near 28.44%, 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.